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Retail Bankruptcies Are a Growing Concern

BLOOMINGTON, MN-Property taxes remain shopping center owners' top concern but retail bankruptcies are No. 2 with a bullet. Best opportunities are restoration and redevelopment, says the Minnesota Shopping Center Association.

By Jim McCartney | Updated on November 14, 2001

BLOOMINGTON, MN-Financial troubles among retailers is an increasing concern for owners and managers of Minnesota’s shopping centers, according to a new industry report. The Minnesota Shopping Center Association found in its 2001 survey of selected executives that “landlords are noting increases in unanticipated store closures due to bankruptcies and poor performance.”

The survey found that retailer bankruptcy ranked as the second-biggest challenge facing shopping centers, up five places from a year ago and surpassed only by concerns about real estate taxes — a perennial top concern despite historic tax reform by the Minnesota Legislature last session. In fact, despite facing higher taxes this year, many expect a decrease of 10% or more next year as the reform takes effect, according to the survey.

Among retailers whose financial troubles have affected Minnesota malls include Montgomery Ward at Northtown Mall in Blaine, Northern Reflections in Rosedale andMaplewood Mall and HomePlace at Southtown. Among those filing for bankruptcy were Lechters, and Video Update, the largest video rental chain in the Twin Cities.

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