Simon Property Group and Authentic Brands Group will purchase Brooks Brothers if it files for Chapter 11, but the move won’t save the mall.

WHAT HAPPENED: According to Bloomberg, if Brooks Brothers files for bankruptcy, Authentic Brands and Simon Property Group plan to buy it.

WHY IT MATTERS

Simon Property Group has desperately sought to save its largest and most lucrative anchor tenants, but it won’t matter if malls continue to decline. According to the New York Times, Brooks Brothers won’t be profitable for at least two years, based on its current performance—and that’s a best-case scenario. Without a vaccine for COVID-19, customers are most hesitant to shop in malls from a public health standpoint. Pre-pandemic, it may have made sense for Simon to prop up its anchor tenants to avoid massive vacancies, but with 75% of consumers opting for curbside pickup, large vacancies matter far less. Mall landlords should instead use this time—when no-one’s looking—to realign their offering with its customers.

While millennials might have been over the mall, experience-thirsty Gen Zers were actually reviving it. But it’s important for mall landlords to realize that Gen Z doesn’t want their parents’ stores. They care about sustainability, supporting local businesses and—now more than ever—ethical brands that stand for something. The folding of legacy retailers gives Simon and others the opportunity to evolve into the mall destination that Gen Z is looking for. Instead of buying stale Brooks Brothers, J Crew and Forever 21, Simon should help up-and-coming brands gain a foothold in their centers—which will drive more traffic now and in the future.