Ayala Malls condones P4-B worth of rents as of May

Published July 23, 2020, 10:00 PM

by Bernie Cahiles-Magkilat

 Ayala Malls gave a total of P4 billion in rent support to its merchants from mid-March to end May this when  government  imposed the lockdown due to the coronavirus pandemic, and the amount is expected to rise as the mall operator further extends assistance to tenants during this crisis.

“That’s about P4 billion that’s the total rent condonation. And as we continue to support our merchants we continue to provide the rental support, the number will continue to increase in terms of  support so we are also trying to find ways how to cushion the impact of the rent support,” said Jennylle S. Tupaz, President of Ayala Land Malls, during a webinar on “Redesigning the Shopping Experience and Service Experience” organized by the Philippine Franchising Association.

Tupaz noted that even before the formal announcement that malls will shut down, they already knew that malls will be closed. The first thing they did was give merchants a day or two to fix their stuff before the closure.

“And second, we decided quickly on the rent condonation.  We said it was going to be painful but it’s the right thing to do, since there is no business, then let’s not charge them,” said Tupaz.

Businesses were not allowed to operate since March 16th, all the way up to modified enhanced community quarantine (ECQ). Even today, not all merchants are allowed to operate yet.

As malls opened, Tupaz said that business still remained weak. As, such Ayala Malls continued to provide support and discounts.

“We’re looking at the first wave would be up to end of August, and then we will review and recalibrate as we observe the sales performance by category,” said Tupaz.

In terms of merchant occupancy, Tupaz reported that it is growing now at 63 to 65 percent across its malls nationwide but still limited since some are allowed at limited capacity and there are still activities that are not allowed to operate at all.  Merchants are also streamlining their operations especially if they have several outlets to stop bleeding financially.

While more merchants have reopened, Tupaz also said that foot traffic is just 25 percent of what they used to have pre-COVID.  Some malls are doing 45 percent while others are lower but the average at 20-25 percent. She blamed the weak foot traffic to the fact that the 21- year olds and below are not yet allowed to go out, not all transportation modes are opened, and most people are still scared to go out.

Tupaz further observed that during this pandemic, sales of some merchandize categories have been doing well. She cited robust sales of electronics even citing an instance of a shortage of gadgets because online education would be the next mode of learning when classes open causing people to shop for laptops and smart phones.

Health products, basic apparel, and sporting equipment also had good sales. She also cited big demand for milk tea drink deliveries.

“It is moving up, but continue to be an uphill battle,” she added.

In terms of health and safety of shoppers, Tupaz said they comply with all the health protocols set by the government and ensure that their merchants are complying as well.