Retail giant L.L. Bean will be shuttering its store in Tysons Corner, situated in Northern Virginia.
In the ever-evolving landscape of the retail industry, the relationship between store operators and landlords continues to be a subject of continual renegotiation, with the pandemic and structural changes playing a significant role. This is evident in the recent announcement by L.L. Bean to close its store at Macerich's Tysons Corner Center in McLean, Virginia.
The closure of the Tysons Corner store, which was among the anchors of the mall, comes as retailers across the nation have been forced to adapt to the challenges posed by the pandemic. Some have skipped, delayed, or reduced rent payments, sometimes by agreement with their landlords.
Macerich, which owns 50% of Tysons Corner, has reported a rebound in traffic, leasing, and rent revenue, indicating a comeback for the retail industry and mall owners. Macerich CEO Thomas O'Hern mentioned that leasing volume for the full year exceeded 2019 levels, and traffic is over 95% of the 2019 traffic levels.
O'Hern also highlighted a dramatic slowdown in retail bankruptcies, a positive sign for the industry's recovery. However, not all mall owners have been as fortunate. Some, including CBL and PREIT, have filed for bankruptcy due to the pandemic's impact.
L.L. Bean, which operates 57 stores in total, including Tysons Corner, has its majority of locations in the Northeast. The Tysons Corner store rents 75,000 square feet of space from Macerich, making it a significant loss for the mall.
However, Macerich remains optimistic. O'Hern stated that retailer demand is at a level not seen since 2015, and Jefferies analysts predict a continuation of above-trend leasing activity, healthier retailers, and positive consumer demand for 2022.
In light of the closure, L.L. Bean is searching for a new location in the area. For now, customers are being redirected to L.L. Bean's location in Bethesda, Maryland. Meanwhile, other L.L. Bean stores in the Washington, D.C. metropolitan area, such as those in nearby Tysons, Pentagon City, or other regional shopping centers, might be considered for closure to optimize customer service.
The closure of the Tysons Corner L.L. Bean store is a significant event in the retail industry's ongoing recovery. It serves as a reminder of the challenges faced by retailers and mall owners during the pandemic, but also of the industry's resilience and ability to adapt. As the pandemic continues to evolve, it will be interesting to see how the relationship between store operators and landlords continues to develop.
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