DIGITAL WORK
New Visas For The New
NomadsT
he economic crisis caused by Covid-19 may be
sending retailers to the exits, but Simon Property
Group, the largest shopping mall operator in the
US, is going the opposite direction. The commercial
real estate giant—with shopping centers across North
America, Europe and Asia—has been buying up struggling
department stores that can play a key role in the company’s
survival.
Malls have been on the decline for years as e-commerce
has rapidly grown, and US department stores have been
hanging on by a thread that has all but snapped during
STOCKSHOPPE / SHUTTERSTOCK.COM the pandemic. A number of major retailers in the US filed
MICHAEL STANKUS / SHUTTERSTOCK.COMBANKRUPTCY BUYING
Simon Property Group Banks
On RetailA
s the Covid-19 pandemic and lockdowns spur remote work
opportunities and crush tourism, a handful of countries are
rolling out special visas for people who want to temporarily
relocate. In recent weeks, Barbados, Bermuda, Estonia and Georgia
have announced new extended-stay visas for individuals who earn
their income abroad.
“In Barbados, of course, they want to try to get people to the
island,” says Bobby Casey, managing director of Global Wealth
Protection, a financial advisory service for location-independent
people. Besides offshore financial services and tourism, “there is
not a lot going on there,” he adds.
The global health crisis has further fueled many existing trends.
Remote work jumped by 159% in the US between 2005 and 2019,
according to a report by Global Workplace Analytics, a consultancy,
and FlexJobs, an online job-search firm. A 2018 study by MBO
Partners, a workplace solution consultancy, found that 4.8 million
Americans described themselves as digital nomads—“independent
workers who choose to embrace a location-independent,
technology-enabled lifestyle that allows them to travel and workfor Chapter 11 bankruptcy protection during the pandemic,
including Sears and J.C. Penney.
As of May, Simon malls had 11 Sears and 63 J.C. Penney
stores. Searching for ways to stem the bleeding from the collapse
of these two department stores is necessary for Simon’s own
survival, too. In addition, the company has some other ideas: It
has its eye on buying J.C. Penney out of bankruptcy, and has also
reportedly been talking with Amazon.com about converting
vacant Sears and J.C. Penney stores into distribution hubs.
This isn’t the first time Simon has invested in failing retailers
and come out on top. Beginning in 2016, Simon turned the
bankrupt apparel retailer Aéropostale into a profitable business
that earned $80 million by 2020, from a loss of $100 million
three years prior. Reporting solid profitability and positive cash
flow from operations in its Q2 2020 financial results, the mall
operator is planning to rescue Brooks Brothers and Lucky Brand
Dungarees out of Chapter 11 and purchased Forever 21 earlier this
year. Simon believes buying failing retail stores now is a strategic
move that will lead to growth once the economy picks up again.
Additional capital injections from Smead Capital Management
will enable Simon to consider additional acquisitions.
Simon may be in the front of a trend for US shopping malls,
which are looking to attract Amazon as they search for new
business models that incorporate retail and logistics. As Simon
expands further into retailing, the model will no doubt be tested
and closely watched. –Lyndsey Zhangremotely, anywhere in the
world”—and an estimated
17 million more aspired to
follow their lead.
They have typically
been freelancers or small-
scale entrepreneurs, but
the pandemic-generated
upsurge in remote work
opens that option to a wider
range of workers.
“This virus has been
a huge tipping point,” says Johannes Voelkner, founder of the
Nomad Cruise, which organizes floating conferences for location-
independent professionals (now on hold due to health concerns).
“I had been waiting for it, but I didn`t think it would come through
a virus.”
Facilitating these trends are technological advances of the last 15
years, Casey says, notably the introduction of Skype in 2004, which
drastically reduced telecommunications costs, and the more recent
broadband explosion. The enabling technology has continued to
multiply and improve, most recently in the form of robust online
conferencing platforms such as Zoom.
—Bill HinchbergerSeptember 2020 | Global Finance | 65CORPORATE FINANCE & CAPITAL | TRENDS