Benjamin Schall, president and CEO of Seritage Growth Properties (NYSE: SRG), participated in a video interview in conjunction with Nareit’s REITweek: Virtual Investor Conference (held June 2-4).
Schall said that in mid-March, Seritage saw the importance of making several immediate adjustments, while also staying focused on the medium and long-term value of both its assets and platform. He said the REIT focused on reducing operating expenses and pausing construction activity.
“Since then, we’ve been working very closely with our tenants [and] managing through the closure time period, and more recently coordinating with them as they start to reopen,” Schall said. He added that Seritage collected roughly 54% of its April rent, in line with its shopping center peers.
Schall said he uses his letter in Seritage’s annual report to speak directly to shareholders and other stakeholders, so it was important for him to address the pandemic in the REIT’s recently published 2019 report. He said that although there is still a large degree of economic uncertainty due to the pandemic, there are also a number of attributes to highlight surrounding Seritage’s portfolio. For example, the REIT has monetized roughly $1 billion of assets over the last three years, he said.
“Even in today’s environment, having that breadth of assets allows us to find constructive buyers for certain pools of assets,” Schall said.
He added that he expects the pandemic to most impact retail real estate through acceleration of trends that were already underway.
“In our minds, it’s an opportunity to rethink and re-envision the types of environments we can create,” he said, noting that he expects to see a greater focus on healthy buildings and environments.