Retail pain from lockdowns jumps borders as shopping malls empty out

Shopping centre landlords and discretionary retailers are again bearing the brunt of lockdowns imposed on Sydney and Melbourne.

Listed retail landlords have suffered hits to their stock prices as Covid lockdowns take a toll on shopper numbers. Picture: Ben McDonald Matrix

Shopping centre landlords and discretionary retailers are again bearing the brunt of lockdowns imposed on Sydney and Melbourne, with strapped businesses calling for a clearer path out of the crisis.

The restrictions have driven down the stock prices of listed retail landlords by almost 10 per cent over the past month as investors dump the stocks as the companies ready to dole out relief to small tenants and face tough talks with larger chains.

Vicinity Centres, part-owner of Melbourne’s Chadstone Shopping Centre, is off by 9.6 per cent over the past month, Stockland is down 9.1 per cent and Scentre has fallen 8.8 per cent.

Many centres had come back strongly on the back of government stimulus packages to spur consumer spending, but the latest lockdowns have only come with limited payments to make up for lost work.

The NSW government is providing some relief to landlords with a special package, but Melbourne is again vulnerable with its city centre already weakened by repeated lockdowns.

NSW commercial tenants and landlords are eligible for support as the lockdown is extended, with the government enacting measures as part of its $5.1bn Covid-19 economic support package.

Commercial and retail landlords will be required to attempt mediation before recovering ­security bonds, locking out or evicting tenants hit by lockdowns.

NSW Finance and Small Business Minister Damien Tudehope said the package showed landlords and tenants “before you take any action, sit down, talk to each other and come to an agreement on what the next few weeks looks like”.

The focus will be on small businesses, as flagged by industry heavyweights including Scentre Group, owner of the local Westfield empire.

“It could be a payment plan, a reduction in rent, or an agreement not to take any action until restrictions end, but we all need to work together to ensure small businesses get through this lockdown and continue to create jobs, deliver vital services for local communities and power our economy forward,” Mr Tudehope said.

The slow vaccine rollout and state governments repeatedly imposing lockdowns have prompted calls from business groups for a way out of the quagmire.

Committee for Sydney chief executive Gabriel Metcalf said the immediate priorities were to get out of lockdown, finish vaccinating the elderly and expedite vaccines for teachers and healthcare workers. But after this, it wants to make reopening schools a top priority and make it easy for bars and restaurants to serve customers outdoors.

The slow vaccine rollout and state governments repeatedly imposing lockdowns have prompted calls from business groups for a way out of the quagmire. Picture: Damian Shaw

Mr Metcalf said people who had been vaccinated should be treated differently. “We should allow people to enter the country who have been double-vaccinated without a two-week hotel quarantine. And we should be using vaccine passports,” he said.

“With the use of large carrots we can achieve high levels of vaccination even if we do not actually require it of everyone.”

The group also called for sensible vaccination targets for reopening. “While we will never convince everyone, we will have better public health outcomes with high rates of coverage,” Mr Metcalf said.

Victoria’s five-day lockdown has also drawn warnings that industry could be damaged.

The Victorian executive director of the Property Council of Australia Danni Hunter said while the government’s priority was rightly to protect Victorians, it must remain mindful of the costs incurred by the community from another lockdown.

“Victorians are suffering from lockdown fatigue and this latest lockdown is a huge blow, particularly for Melbourne’s CBD which is still trying to recover from previous lockdowns,” Ms Hunter said. “It was only last week that the mask mandate for city workers was lifted and this latest lockdown will set back our recovery.”