COVID-19: Impact on Thailand’s Retail Market

SUMMARY

• Shopping centres throughout Bangkok have been under lockdown since 22nd of March and are not expected to open until 1st of May at the earliest
• Retail landlords have reacted quickly to provide relief as retailers have faced forced closures and cuts to overheads have been substantial
• Some landlords are offering up to 100% rent relief to tenants who have been shut down and up to 50% for those tenants who are still able to operate
• The retail sector is unlikely to recover fully until tourism arrival figures reach similar levels seen pre-crisis

The global COVID-19 pandemic has led to the greatest impact on trading conditions around the world in recent memory. Over 1.9 million people have been infected globally, with 2,400 having tested positive in Thailand (8th April 2020). Since the 22nd of March, as a social distancing measure, all shopping centres and retail outlets have been ordered to close and are not expected to open until 1st May at the earliest. Through this period, supermarkets, pharmacies and banks have been allowed to continue trading, as have restaurants though only for takeaways and deliveries, though all other retailers have been forced to shut. This has left the majority of retailers in crisis as they face fixed overheads and no sales revenue from which to pay.

In response, some landlords have begun to offer up to 100% rental relief to closed tenants and as much as 50% for those that have been able to continue trading. Though it is only a handful of landlords offering such generous relief at present, it is anticipated that if the lockdown were to be extended then a greater number of landlords would begin to offer these levels in order to relieve some of their tenants’ burden.