The Simon Property Group, which owns and operates about 200 malls across the U.S, is suing Gap Inc., the parent company of Banana Republic, Old Navy and The Gap for failure to pay rent for the months of April, May, and June according to a report in The Real Deal. The suit alleges that Gap owes Simon over $60 million in unpaid rent on its 412 stores housed in Simon malls. The Gap, best known for its boring clothes and sensibly priced jeans, may soon become one of the punkest places to shop if it survives this lawsuit.
In April, Gap Inc. released a public filing clearly stating that its North American stores would not be paying rent after they had been closed down due to Covid-19. The rent on its North American stores totals $115 million per month according to the filing. I thought my rent was too high.
Despite warning landlords that there was no money coming in, Gap Inc. is being sued in Manhattan and Orange County, California for separate instances of failing to pay rent. A bankruptcy attorney told the New York Post, “Everyone will be watching for the first major court decision on whether the pandemic excuses the payment of rent.” I for one cannot wait to hear the argument from a company that started 2020 with $1.7 billion.