Taubman Centers Inc. (TCO - Free Report) recently informed that it has temporarily shut down all its shopping centers in the country barring two, in response to the coronavirus pandemic. The closure stands effective from the close of business on Mar 19 to Mar 29. This shut down may be extended in accordance with the directions of the local or state government.
Among the malls that are temporarily closed in California are Beverly Center (Los Angeles), Sunvalley Shopping Center (Concord) and The Gardens on El Paseo (Palm Desert). The malls closed in Florida are Dolphin Mall (Miami), International Plaza (Tampa) and The Mall at University Town Center (Sarasota).The move comes as the number of infected patients in the United States continues to flare up, while the spread of the virus outside of mainland China continues. Recently, Simon Property Group (SPG - Free Report) also decided to close all of its retail properties, including Malls, Premium Outlets and Mills in the United States till Mar 29.
Retailers, including Macy’s (M - Free Report) , J.C. Penney (JCP - Free Report) and several others have been forced to close their stores. As more and more people are opting to stay indoors and availing online purchases, many retailers are keeping their e-retail operations running, while some others have preferred to reduce store hours too.
As a consequence, retail REITs, which have already been reeling under store closure and bankruptcy issues, are now bearing the impact of this mass aversion of consumers gathering in public spaces.
Total returns of REITs belonging to the Regional Malls category have plunged 41.80% so far in March, while those in the Shopping Centers group have slumped 44.12%. In fact, over the past month, Taubman Centers’ shares slid more than 17.1% to $43.15.
Notably, in February, Simon Property Group (SPG - Free Report) announced that it has agreed to acquire Taubman Centers in a deal valued at $3.6 billion. Simon Property will buy an 80% ownership stake in The Taubman Realty Group Limited Partnership ("TRG"). Simon Property will acquire all of Taubman common stock for $52.50 per share in cash. Moreover, the Taubman family will sell one-third of its ownership interest at the transaction price and remain a 20% partner in TRG.
Here’s how shares of Taubman Centers, which currently carries a Zacks Rank #3 (Hold), have performed so far this year. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
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