Mall owner sues Gap for rent on coronavirus-shuttered stores

Daniel Fowler
June 7, 2020

Simon, per the lawsuit filed earlier this week, is asking the court to order Gap to pay up to $66 million, in addition to future rent payments. The landlord is seeking to be paid rent for those months, as well as attorney fees and other charges, according to the lawsuit.

(GPS), claiming it failed to pay $65.9 million in rent and other charges.

"We remain committed to working directly with our landlords on mutually agreeable solutions and fair rent terms".

"It's important to note the profound effect that Covid has had on shopping centers as well, leaving them closed to us and our customers for months", said the company in its statement.

"We are optimistic that the actions we've taken will provide a stable foundation as we navigate near-term uncertainty and refashion Gap Inc. for long-term growth", Syngal said. In April, Gap said in a Securities and Exchange filing that it had stopped paying rent starting in April and was in discussions to renegotiate or, in some cases, even terminate leases and close stores entirely.

USA stocks end mixed following disappointing data
Economists polled by Reuters had forecast the unemployment rate jumping to 19.8% in May and payrolls falling by 8 million jobs. The Nasdaq also breached its all-time closing high reached in February, but pared its gains to end the session a bit below it.

While online sales improved for Old Navy and Athleta, they fell for Banana Republic and Gap, underscoring weakness at the brands that pre-dates the economic upheaval following the lockdown.

Simon Property didn't respond to requests for comment. Net sales dropped 43% to $2.11 billion, reflecting the temporary closure of approximately 90% of Gap's global store fleet amid the pandemic. Cash flow performance was impacted by the sales decline caused by the pandemic, partially offset by $500 million borrowed during the quarter under the company's unsecured revolving credit facility. More expensive brands such as Gap and Banana Republic, have shown poor results, as buyers chose to dress casual during the isolation of the house, said chief Executive officer Sonia Singhal.

The apparel giant now has 1,500 -plus stores open in North America, and expect to have the vast majority of its North American stores re-opened in June.

Allison Prang contributed to this article.

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