Simon Property Group, the largest shopping mall operator in the United States, filed a lawsuit against American clothing group Gap Inc. on Tuesday, accusing it of failing to pay rent and other expenses, totaling more than $65.9 million. Gap Inc. announced key financial data for the first quarter of fiscal 2020 on Thursday, reporting a quarterly loss of nearly $1 billion due to temporary store closures due to the epidemic.
Simon Property Group’s lawsuit alleges that Gap Inc. failed to pay rent for April, May and June 2020 and “amounts due will continue to accrue each month, including interest. .”
Simon Property Group said in May that it had reached a proposal to defer rent payments to some tenants. But it did not specify which tenants were included.
David Simon, CEO of Simon Property Group, said at the time: “Due to the huge changes caused by the epidemic… we have given extension preferential treatment to many retailers. We feel it is the right thing to do.” But he added Said: “The contract is our bottom line, and we also want to be paid.”
Simon Property Group and Gap Inc. did not comment on the lawsuit.
Last month, Gap Inc. was also sued by another of its landlords for failing to pay rent for April and May at a store near Times Square in New York City. Including water and snow removal fees, the total was more than $530,000.
Gap Inc. CEO Sonia Syngal said when announcing the financial report that the group’s higher-priced brands Gap and Banana Republic performed poorly because of the epidemic. During this time everyone stayed at home and wore casual clothes. But demand for the group’s affordable clothing brands, Old Navy and Athleta, was strong.
Gap Inc. said it would prioritize closing some Gap stores and seek rent concessions for stores that are well positioned but cannot afford the rent.
Gap Inc. Chief Financial Officer Katrina O’Connell also said on the conference call: “While our Old Navy and Athleta brands are strong, the profitability of Gap and Banana Republic has not yet reached the level we expected. level.”
Gap Inc. operates nearly 2,800 stores in North America. The group said that 55% of its self-operated stores in North America have reopened, and sales in the online business are growing rapidly, with online sales more than doubling in May.
For the first quarter of fiscal 2020 as of May 2, Gap Inc.’s key financial data are as follows:
Net sales fell year-on-year from $3.71 billion 43% to $2.11 billion.
Net loss was US$932 million, or US$2.51 per share, including a US$484 million write-down of store and operating lease assets and a US$235 million excess inventory charge
Online sales increased by 13% year-on-year
By brand:
Old Navy: Net sales fell 42%, of which store sales fell 60% and online sales increased 20%
Gap: Net sales Sales fell by 50%, of which store sales fell by 64%, and online sales fell by 5%
Banana Republic: Net sales fell by 47%, of which store sales fell by 5% 61%, online sales fell 2%
Athleta: Net sales fell 8%, of which store sales fell 50%, and online sales increased 49% . </p
