Retail giant L.L. Bean to shutter Tysons Corner store in Northern Virginia.
Macerich's Tysons Corner mall in McLean, Virginia, is making a comeback, with traffic, leasing, and rent revenue rebounding to over 95% of the 2019 levels. This positive trend is predicted to continue by Jefferies analysts for 2022, with above-trend leasing activity, healthier retailers, and positive consumer demand expected.
The mall, which is among the largest in Macerich's portfolio, is home to several well-known retailers. Stores that have maintained their location at Macerich's Tysons Corner Center and are likely to continue include Macy’s, Hollister, and Vuori, as well as new attractions like Level99 entertainment and the Peppa Pig x CAMP experience.
However, the retail industry is still being reshaped. During the early stages of the COVID-19 crisis, retailers, including those that filed for bankruptcy, renegotiated their leases. Some retailers skipped, delayed, or reduced rent payments, which has put a strain on mall owners. This strain was evident when mall owners CBL and PREIT filed for bankruptcy.
Despite these challenges, Macerich has managed to weather the storm. The company owns 50% of Tysons Corner, and its CEO, Thomas O'Hern, reported that retailer demand is at a level not seen since 2015. Leasing volume for the full year exceeded 2019 levels and is at its highest point since 2015.
One notable change at the mall is the closure of L.L. Bean's store, which has rented 75,000 square feet of space from Macerich since 2001. The store, among the mall's anchors, is set to close on January 17. For now, customers are being redirected to L.L. Bean's location in Bethesda, Maryland.
L.L. Bean operates 57 stores in total, including Tysons Corner, with the majority of them in the Northeast. The executive highlighted a dramatic slowdown in retail bankruptcies, suggesting that the tide of store closures has receded in 2020.
The relationship between store operators and landlords is under continual renegotiation due to the pandemic and other structural changes in the industry. As the retail landscape evolves, it will be interesting to see how Macerich's Tysons Corner mall adapts and grows in the coming years.
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