The European Council of Shopping Places (ECSP), the association which represents the European retail property sector, has released its position paper responding to the financial impact of Covid-19 on the retail property sector.
The uncertainty of repeated lockdowns, the inconsistent approach of different governments, and the overly onerous focus on retail property owners to support an industry in crisis is not sustainable, the report suggests.
In its paper, ECSP calls on the relevant authorities to urgently consider a raft of measures that could help mitigate the impact and risk associated with the pandemic on Europe’s retail property sector. These include reviewing financial provisions; the suspension or waiver of financial covenants; and ncreased financial and banking flexibility and extended timelines.
The report also asks for a more holistic approach to subsidies, where the burden is shared, and for the provision of guidelines outling basic rules and principles on asset classification and property tax payments. It also asks that retailers are provided with credit lines.
'Shopping places are working hard to manage the situation from a commercial and operational perspective, providing access to essential goods and services despite rapidly changing circumstances. However, the closure of hundreds of thousands of shops, stores, bars, restaurants, and places of commerce across the EU is hitting our sector extremely hard,' said Joost Koomen, secretary general of ECSP.
Koomen added: 'We call for a coordinated strategy and approach to ensure that this short-term crisis does not have a longer-term detrimental impact that could result in closures, bankruptcies, and rising unemployment.
'This would have a devastating effect on the communities shopping places serve. Let’s not forget that shopping places in Europe welcome billions of visitors every year and are a focal point for economic and social activity, providing employment and attracting investment. It is consequently an important hub in a much broader value chain.'
The ECSP paper concludes that the Covid-19 pandemic continues to have unprecedented consequences on the life of European citizens, the economy, and society as a whole. However, it warns that retail landlords across Europe are having to shoulder the economic consequences of significant drops in footfall, rent collection, and increased costs, with very little financial help, support or guidance.