Bermuda’s premier shopping mall expects to rebound in 2024 as it exits the occupancy slump of the pandemic years.

The Washington Mall expects retail occupancy to rise to 92 per cent in the new year - the best occupancy in at least six years - and it has already benefited from improved commercial rents this year from a take-up in office space.

Local Data Company, which bills itself as the UK’s most accurate provider of retail and leisure location data, has reported that the 2020 pandemic hit shopping centres harder than any other location type, with vacancies reaching a peak of 19.4 per cent in 2021.

A 2023 Moody’s Analytics report points out that retail suffered the most when the “great financial crisis” hit in 2008. It said that while there were other factors at play such as e-commerce and online retail, Covid and the upsurge of remote work had exacerbated retail woes.

The mall has been a bellwether of Bermuda’s retail success, even though more retailers there and elsewhere have felt the encroachment of overseas online shopping cut deeply into their earnings.

It is not the only issue retailers have had to face in recent years.

Paul Slaughter, director and general manager, Washington Properties (Bermuda) Limited, said the pandemic had led to somewhat of a downturn but not quite as bad as the effect of the global financial downturn that began in 2008.

“Our worst year may have been 2008 or 2012, the years of the financial crisis,” he recalled. But just as they were for many other businesses, the Covid years will also be remembered for their deleterious effect on business.

“We’ve had new tenants [in 2023] and more arriving in 2024,” Mr Slaughter said. “Things have been slowly improving over the last 12 months.

“We are seeing more space being taken up by service industries, such as hairdressers and IT services.

“We lost a few tenants because of Covid but our occupancy is higher now than before Covid. We are quite pleased about that.”

Washington Mall occupancy for retail stores at year-end 2019 was 90 per cent, falling a year later to 77 per cent, as the psychological toll of Covid deepened and put a global damper on our way of life.

Such a wild swing in occupancy Is unusual for the largest retail shopping malls in only a year, which normally records changes such as vacancies in fractions of a per cent.

By the end of 2021, occupancy had fallen further to 75 per cent and languished there (77 per cent) by the end of 2022.

In December, with the first significant improvement in four years, occupancy had climbed to 88 per cent.

These numbers exclude pop-up shops, which have become a feature of mall life, as entrepreneurs test ideas, using short-term rentals.There was far more of that this year, more mall activity and more storefront coverage than a year ago.

Mr Slaughter added: “Prior to Covid, we had seven vacant units. During Covid, we had an average of 15 vacant units.

“This December, we had eight vacant units, which were mostly occupied by pop-up shops.

“In January, we have three new leases starting, which will leave five vacant units.

“We’re also seeing increased interest in office space, with an additional 20,000 square feet leased in the current financial year.”