When will shopping centers open in Moscow after quarantine

2024 Author: James Gerald | [email protected]. Last modified: 2023-12-17 14:00

Commercial real estate owners do not yet know exactly when shopping centers (malls) will open in Moscow after the quarantine. When the mayor of the capital, Sergei Sobyanin, announced that the high alert regime in Moscow would last until May 31, it became clear that the shopping center would not start operating earlier than June.

Phased cancellation of the restriction regime in Moscow

On May 6, after Russian President V. V. Putin announced the end of non-working days from May 12, Moscow Mayor Sergei Sobyanin decided that the high alert regime in the capital would not be weakened until May 31.

At the same time, he announced that industrial enterprises, including construction companies, would start operating in Moscow on May 12.

The mayor said that the lifting of restrictive measures will take place in three stages:

1. Muscovites will be allowed to play sports on the street.
2. Educational institutions will be opened and family walks on the street will be allowed.
3. Public gardens and parks will be opened for mass visits.

Service enterprises, which include shopping centers, can open only at the third stage of the exit from the self-isolation regime in Moscow, like ordinary stores selling non-food products.

Shopping center problems due to coronavirus

Only grocery stores, pharmacies and banks operated in Moscow shopping centers during the high alert mode announced due to the COVID-19 epidemic. All other retail outlets were closed.

This led to the fact that for a month and a half of forced downtime, the owners of the shopping center lost 90% of their income. In such a situation, at the end of April, they began to say that if work is not resumed after the May holidays, the staff will have to be fired.

After V. V. Putin announced a package of state aid to businesses that suffered during the epidemic due to forced downtime, public talk that the management would lay off staff stopped.

After the high alert mode was announced in April, the owners of the shopping center stopped collecting rent from tenants in full, following the government's recommendations to big business.

At the same time, the tenants simply closed their retail space operating in the shopping center and dismissed the employees, and the complexes have to pay for utilities, the work of the cleaning service and security guards.

At the same time, the industry is heavily indebted. The amount of funds taken by the owners of shopping centers from banks is 2 trillion rubles. In such a situation, under pressure from government recommendations, the banks went to meet the owners of complexes, including those in Moscow, postponing the payment of the loan body to a later date.

Opening of field hospitals in the Moscow shopping center

At the end of April, it became known that a number of Moscow centers would open field hospitals to receive patients with coronavirus. Therefore, for them, the question of when shopping centers will open in Moscow after the quarantine is not yet relevant. That is, the shopping centers of the capital will not be fully launched in May.

It is known that in the ATC "Moscow", located on the Kashirskoye highway, a temporary hospital, which opened in early May, will work until July. It is also planned to open temporary infectious diseases hospitals in other Moscow shopping centers:

• in the trade fair complex "Moscow";
• at VDNKh;
• at Crocus City Hall;
• in the Patriot Park;
• at Crocus Expo.

It is not reported how much the Moscow authorities will pay for this to the owners of the shopping center. The population of Moscow has not yet complained that shopping centers do not work. Muscovites make purchases of non-food products online.

In general, the coronavirus has raised the question of the profitability of large commercial real estate. Not only shopping centers, but also large office centers after the end of the epidemic may be left without clients.

As part of the gradual exit from the self-isolation regime, companies and firms operating in the trade in non-food products and in the entertainment industry may change their work format or even close down due to the fact that the COVID-19 epidemic has radically changed their usual life.

In the context of the prospect of a second wave of the epidemic, a large number of tenants may simply not return to shopping centers, completely switching to a remote work format. A number of entertainment companies, as well as travel agencies operating in external directions, may close due to a sharp drop in demand for their services.

In such a situation, shopping centers will remain empty even after the quarantine is canceled. It is still difficult to indicate the exact date when shopping centers will be opened in Moscow after the quarantine. From what date this will happen, most likely, it will become clear by the end of May.

Summarize

1. The opening of companies engaged in the service sector in Moscow will take place at the third stage of the exit from the high alert mode.
2. In a number of shopping centers today in the capital, field hospitals are opening to receive those infected with coronavirus.
3. It is not yet clear whether, after the end of quarantine, all Moscow shopping centers will be able to work in full, since the situation with the coronavirus can greatly change the structure of this industry.
4. Many tenants can completely switch to online trading mode, and the entertainment and leisure sector can sink a lot due to the lack of customers.