PRESS: Apparel retailers ask for rent discount amid coronavirus

MOSCOW, Mar 16 (PRIME) -- The largest apparel, cosmetics and accessories retailers, operating in Russia have asked mall owners for a rent payment discount in light of the spread of coronavirus, Kommersant business daily reported on Monday citing the companies’ letters and sources.

The companies, which include Zara, Bershka, Reserved, Gold Apple and Rive Gauche, do not rule out they may be forced to close retail outlets temporarily, the daily reported, adding that no direct comments from the companies were available.

Managing Partner at RedStone Indira Shafikova told the daily that the current drop in attendance at malls is “catastrophic.” She added that most of mall tenants are likely to be given discounts of 10–15% for the short term.

Mikhail Burmistrov, analyst at research agency InfoLine-Analytics, told the daily that the offline segment of fashion retail will see a record drop in sales by the end of June. Apparel retailers have failed to fully sell their winter collections due to the warm weather and are having difficulties with production and delivery of spring and summer collections as factories in China are closed, he added.

One of the sources, working with a large apparel chain, confirmed the daily that large retailers have still not been able to deliver summer collections from China.

But Burmistrov is sure that there is no risk of malls closing at the moment.

A spokesperson for sports apparel retailer Sportmaster told the daily that “closing the stores is out of the question just yet.” A spokesperson for electronics retailer M.Video-Eldorado said that the company is ready to work in conditions when activities of large malls are temporarily suspended.

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