50,000 U.S. retail stores forecast to close over the next five years

The shopping mall may not be dead, but that hasn’t dented the number of retail stores expected to close over the next five years. Between 40,000 and 50,000 shops could be shuttered, according to figures from Swiss investment bank UBS.

The outlook is slightly better than during the pandemic, when 80,000 stores were expected to close, but the high number of retail closures is primarily expected to hit fashion and accessories industry, which will see nearly half of all closures, in addition to home furnishings and electronics store closures.

Business is expected to boom for general merchandise stores such as Target and Walmart, according to CNBC. “Brick-and-mortar shops have proven to serve a critical role for retailers’ businesses during the Covid pandemic, the bank said in a new report on Wednesday, and retail sales growth has remained strong, in part due to rising inflation. This all bodes well for the future of physical stores, according to UBS retail analyst Michael Lasser,” said CNBC.

Traditional shopping malls remain at higher risk for closures than neighborhood strip centers, UBS said. This is due to shoppers’ increased preference to shop local.

Article source: CNBC