One of the biggest retail real estate owners in the country,
Brookfield Properties, is going through a major round of job cuts, CNBC has
learned, as the coronavirus pandemic takes a toll on its business and new
leasing activity at its malls dries up.
“While many companies were quick to implement furloughs and
layoffs at the onset of the pandemic, we made the conscious decision to keep
all our team employed while we gained a better understanding of its longer-term
impact on our company,” Jared Chupaila, the CEO of Brookfield Properties’
retail group, said this week in an email to employees, which was obtained by
CNBC.
However, he said, the mall owner has now decided to make
cuts “to align with the future scale of our portfolio.”
Chupaila said the cuts are going to affect roughly 20% of
the company’s workforce, across both its corporate headquarters and leasing
agents on the field. Brookfield Properties’ retail division employees about
2,000 people.
Brookfield Properties has more than 170 retail properties in
43 states, according to its website, including Brookfield Place downtown in New
York City and Fashion Show Mall in Las Vegas. It added a number of malls to its
portfolio when it acquired the Chicago-headquartered mall owner GGP for $9.25
billion in cash back in 2018.
Brookfield Asset Management’s real estate businesses employ
roughly 22,000 people globally, according to its latest annual filing, which
includes other asset classes like office space.
A representative from Brookfield declined to comment beyond
the memo.
A number of other retail real estate owners have felt
similar pain. The Tennessee-based mall owner CBL & Associates is expected
to file for bankruptcy protection no later than Oct. 1.
The biggest U.S. mall owner in the country, Simon Property
Group, furloughed 30% of its workforce in March, as it was forced to
temporarily shut its malls nationwide. It also permanently laid off some of its
employees at the time.
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