Polish shopping malls put losses at EUR 6.6 billion

Shopping malls have lost an estimated PLN 30 billion (EUR 6.64 billion) due to restrictions introduced by the government in an attempt to limit the spread of Covid-19.

"The spring lockdown resulted in a decrease in revenues by over PLN 17.5 billion (EUR 3.87 billion),” the Polish Council of Shopping Centres wrote in a press release. “The November closings in shopping centres resulted in an estimated PLN 8 billion (EUR 1.77 billion) of lost turnover."

It added that as a result of further restrictions introduced on December 27, 2020, "the industry's turnover will fall by further PLN 4 billion (EUR 890 million)."

"Despite huge losses, owners of commercial buildings still incur fixed costs for property maintenance, management and servicing of bank debt," the council explained and appealed for help for tenants and owners of shopping centres in the form of co-financing of fixed costs including rent.

The council added that "similar measures have been introduced in some European countries, such as the Czech Republic and Lithuania. They would enable all participants of the shopping centre industry to settle their financial liabilities, including rents and interest instalments."

Finally, the council appealed to the government to reopen shopping malls as soon as possible arguing that otherwise bankruptcies and job losses are inevitable as well as the destabilisation of the financial system.

"Serious financial problems for lessors resulting from the lack of revenues will have an impact on the banking sector due to the scale of loans granted for the construction and purchase of commercial real estate," the organisation wrote.

The Polish Council of Shopping Centres affiliates over 200 companies operating in the trade and services industry.