ORANGE COUNTY, Calif. — NewMark Merrill Cos. has a lot of plans to bring customers back to its retail centers in Orange County.
In Anaheim, at the Anaheim Town Square, the shopping center will be hosting more drive-in movie nights and every second Saturday, a kid’s craft event.
In Placentia, the Placentia Town Center will continue to offer a monthly farmer’s market and discounts at some restaurants.
In Santa Ana, the Bristol Warner Village hosted a Muay Thai kickboxing event and will offer a gift card giveaway for completing a survey.
And there’s more events to come, NewMark Merrill Founder and President Sandy Sigal said.
“We’re going to host more drive-in movie nights on the parking lots, drive-in band and concerts and even drive-in Bingo,” Sigal said. Sigal said they are looking to bring in any type of events that could possibly attract more people to the retail centers.
With the news that Orange County can reopen some retail businesses at limited capacity, Sigal is one of hundreds of retail property owners across the county now trying to boost their retailer’s business by hosting events on their massive parking lots during the coronavirus pandemic, which has restricted the way people shop at brick-and-mortar retail locations. Events such as drive-in movies at retail center parking lots and concerts, which were experimental in the early stages of the coronavirus pandemic, appear to be the new norm to attract visitors for many retail centers and mall owners.
The Woodland Hills-based NewMark Merrill owns and manages 85 shopping centers with 2,000 tenants, mostly in California. NewMark has four shopping centers in Orange County.
“It’s been a challenge,” Sigal said about navigating through the coronavirus crisis.
Last week, Orange County moved down California’s new four-tier color-coded system that monitors coronavirus cases across the state. The county moved from purple, the most restrictive tier, to red.
The red tier allows the county to reopen indoor dining, movie theaters, and places of worship at 25 percent capacity or 100 people, whichever is less. Barber shops and nail salons have reopened with new health guidelines. Retail and shopping centers’ capacity went from 25 percent to now 50 percent. Gyms are also allowed to reopen but at 10 percent capacity, according to the state’s “Blueprint for a Safer Economy” reopening plan. As of Monday, Orange County recorded 44 new COVID-19 cases and zero deaths, bringing the county's total to 50,974 cases and 1,093 deaths.
If Orange County continues its downward trend, more businesses will reopen.
Businesses reopening even in a limited setting is a bit of good news but not great news for Sigal, who has seen his company’s rent collection drop since the pandemic began and forced closed nonessential businesses since mid-March to prevent the spread of the virus.
Of all the main commercial business sectors, the brick-and-mortar retail industry has been one of the most severely impacted by the pandemic.
Full-service restaurant sales in the county are down, according to JLL, a commercial real estate company that tracks retail performance. Quick service restaurants or fast food are faring well but only if it has a drive-thru.
But overall, since the start of the pandemic, many retailers had to seek assistance from their landlords and apply for the government’s paycheck protection program, according to JLL’s second quarter report.
“Current market conditions have forced some retailers to seek lease restructures,” the report states. “This primarily consists of rent deferral with payments over time. Landlords and lenders have become more flexible with these requests.”
Sigal has had to negotiate with several of his tenants who couldn’t keep up with their rent payments. In April and May, Sigal’s rent collection was around 55 percent. Last month, it went up to 80 percent, he said.
“It’s pretty good but you know, it’s because we have worked out many deals with tenants and some of that is not all rent,” Sigal said. “You have to remember half of our tenants – the grocery stores, the drive-thru restaurants, the Targets, the Walmarts – they’ve done well. It’s the small retailers. The small restaurants that is still really struggling.”
Sigal said with this reopening, one thing he and his company are trying to avoid is another shutdown. When the pandemic began in March, the state closed a majority of businesses but reopened too quickly in July just to close it down again when the number of coronavirus cases spiked across the county and state.
Sigal said he is taking no chances. He has upped the number of social distancing and health guidelines signage at his retail centers. He is requiring anyone that enters any business in his retail centers to wear a mask. He has hired more cleaners to keep his centers clean and security guards to enforce health and mask guidelines.
He does not want to see another shutdown.
“Each time a tenant has to reclose, over and over again, is a bigger and bigger disaster,” he said. “These small businesses don’t have large cash cushions. Closing and reopening, re-hiring, re-buying and re-advertising all costs a lot of money. We couldn’t afford to reclose last time. We can’t afford to close this time.”
In the coming months, Sigal said, aside from drive-in movies, his company will be announcing a new mural program at retail centers in Anaheim and Santa Ana. They are adding more outdoor seating across all of NewMark's retail centers to support restaurants and mobile technology to make it easier for customers to pick up orders.
"Right now, we want to tell the community what we're doing and telling success stories," Sigal said. "On one hand it's very exciting but on the other hand let's not pretend this is going to be a homerun for our tenants because it isn't. They still have limited capacity. There are still a lot of rules that make it difficult for them to make a profit. The cost of sanitizing and PPE (personal protective equipment) is very expensive and customers are still cautious. So there's still a lot to be done."