Mall traffic has declined in the wake of the pandemic, and it’s been battering retailers since.
The events of 2020 forced consumers out of stores, and many learned to adjust to shopping online. Even once society began to open back up, some consumers were skittish about entering malls and continued to primarily shop online for the convenience and comfort.
More recently, inflation has kept consumers out of malls rather than health-related fears. Rising prices came to a head in mid-2022 and have been slow to drop.
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The latter part of 2024 saw some relief on the inflation front, with Consumer Price Index levels inching closer to the Federal Reserve’s 2% target rate. But inflation reversed course in 2025, rising 3% annually in January and 2.8% annually in February.
In light of economic conditions, consumers have been forced to be more mindful in their spending. Many are cutting back on non-essential purchases to adapt to rising grocery costs.
That’s been a tough blow for mall retailers in particular, who face natural competition by virtue of having to share a roof with hundreds of other stores.
Bidders can now take over bankrupt retailer’s leases.
Popular mall retailer files for bankruptcy a second time
Although many retailers have struggled to recover from the events of the pandemic, Forever 21 was in bad shape before the words “social distancing” actually meant something. In 2019, the iconic mall mainstay filed for Chapter 11 bankruptcy in the hopes of hanging on.
Unfortunately, competition from foreign retailers coupled with rising costs drove Forever 21 into bankruptcy once again in March. The company announced plans to liquidate its young adult-friendly inventory and shutter hundreds of stores.
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Those closures largely have not happened yet, though.
Forever 21 said on its website that “our stores will remain open for the time being and we will continue to fulfill customer orders placed online. We also will continue to honor customer gift cards and store credit through and including April 15, 2025.”
However, the company warned that all U.S. sales are now final, including website sales. Forever 21 will also no longer be accepting returns or exchanges, nor will it be offering new gift cards.
Forever 21 leases are up for sale
Forever 21 maintains a roughly 350-store footprint in the U.S. As of March 19, almost 100 of those leases have gone up for grabs on the heels of the company’s bankruptcy filing.
New York-based RCS Real Estate Advisors is marketing the properties, which cover 32 states as well as Puerto Rico.
In California, 18 store leases are ready for bids, including the company’s headquarters — an 164,000-square-foot space at California Market Center. RCS says it will actively respond to all inquiries as a first step.
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Forever 21 isn’t the only bankrupt retail giant to unload store leases this year. Earlier in 2025, Party City went a similar route.
RCS says that Forever 21’s available leases offer expanding retailers a chance to secure space in a tight market, and that the leases offer favorable terms. Many of the available leases are percentage-only leases, which allow retail tenants to pay their landlords a portion of their monthly sales instead of committing to a flat monthly fee.
“RCS is positioning Forever 21’s lease spaces as highly attractive brick-and-mortar locations, offering prospective tenants a unique opportunity to secure prime retail space in high-foot-traffic areas,” said Spence Mehl, a partner at the firm.
But there may be challenges to filling those leases.
Some of the available spaces have irregular shapes instead of the traditional rectangular setup retailers tend to prefer. And rising construction costs could make it difficult for retailers to take over high-profile spaces.
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Also, some retailers are specifically moving away from malls in favor of standalone locations. The idea is that moving outside of the mall environment lessens competition. So despite the favorable terms available on Forever 21’s leases, the offers may not roll in at full force.
Mehl said the process of soliciting bids for Forever 21’s stores will take 30 to 60 days. An auction will be held if there are competing bids for specific leases.
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