The last few years haven’t exactly been great for long-time mall retailers, with chains like Wet Seal, BCBG, Aeropostale, and The Limited filing for bankruptcy, while Abercrombie & Fitch and Barnes & Noble struggle to remain relevant. Now that two additional mall mainstays — Express and Urban Outfitters — one CEO is saying that retailers have no one to blame but themselves.
Speaking to investors last night, Urban Outfitters CEO Richard Hayne pointed to the rampant spread of retail stores in the 1990s and 2000s.
“This created a bubble, and like housing, that bubble has now burst,” said Hayne, according to Bloomberg. “We are seeing the results: Doors shuttering and rents retreating. This trend will continue for the foreseeable future and may even accelerate.”
Bloomberg notes that both Urban and Express saw their most recent earnings fall short of estimates, providing yet another piece of evidence that consumers aren’t heading to the mall like they used to.
While Urban Outfitters posted a profit of $0.55 a share for the fourth quarter, the result was a cent away from estimates of $0.56.
At Express, fourth-quarter results were a bit more bleak. Analysts had predicted a gain of $0.14 per share, but actual figures put first quarter earnings at flat or a loss of $0.04.
The CEOs for both companies blamed the less than stellar figures on too many retailers, slower mall traffic, and a retailer environment that relies too heavily on promotions.
Said Hayne, “The U.S. market is oversaturated with retail space and far too much of that space is occupied by stores selling apparel.”