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With the government’s COVID-19 Business Support Measures ending on Nov 19, another wave of business closures is expected to happen, says retailers and observers.
The retail industry continues to fight the effects of the COVID-19 pandemic, with homegrown departmental store Robinsons being its latest high-profile casualty.
The Straits Times (ST) reported that 457 retail companies have shuttered, according to figures from the Accounting and Corporate Regulatory Authority, with business cessations in the retail trade sector hitting a 10-month high in September.
Retailers such as Topshop, Esprit and Sportslink have ceased physical operations, with some moving online as a resort to diminishing store sales due to the low foot traffic caused by safety restrictions.
With the government’s COVID-19 Business Support Measures ending on 19 Nov, another wave of business closures is expected to happen, say retailers and observers.
“Many of us are fearing strict or harsh landlord action the moment the government lifts the moratorium,” said Mr Terence Yow, a representative of the Singapore Tenants United For Fairness, who shared that the majority of commercial tenants have not received many concessions from their landlords beyond what has been mandated.
Mr Yow hopes that safe distancing requirements at malls can be eased by the year-end and Chinese New Year shopping seasons to help more front-line businesses survive this economic downturn.
Ms Christine Li, Head of Research for Singapore and Southeast Asia at Cushman and Wakefield, advises landlords to lower their rental expectations and focus on retaining tenants, especially with more casualties expected in the coming months.
The overall prime retail rent in Orchard Road is expected to decline by 10% this year, while suburban retailers, being lesser hit compared to tourist hotspots like Orchard Road, may see a drop of 5% in rent, shared Ms Li.
Some retailers have found themselves turning to online sales and adopting various online marketing strategies to make up for the drop in footfall in the malls along Orchard Road and in Other City Areas such as Marina Square, and Raffles City.
Mall operators, such as Frasers Property Retail and CapitaLand, have also invested in e-commerce platforms to help tenants drive online sales.
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