It's final, Circuit City will be completely liquidated in bankruptcy and more than 40,000 workers will experience job losses, shopping centers will lose rental income, already struggling newspapers will lose advertising revenue and many suppliers and vendors will go bankrupt because they simply will never get paid. According to an article in the Dallas Morning News, the Circuit City bankruptcy is bigger than any so far in this current downturn in the economy. The amount of job losses alone is the size of a small city and those jobs will not return anytime soon. The article sums up perfectly the damage that the Circuit City bankruptcy will do to the retail and commercial real estate industries.
"The anchors are really one of the most important pieces of the center," Vedder said. "They bring in the traffic, they are the lifeblood that (other) tenants rely on to bring customers to the stores."
Analysts say most landlords can expect to see weak to no rent growth this year and higher retail vacancy rates. Those factors could push many owners of shopping malls, office towers, apartment buildings and industrial buildings into foreclosure or bankruptcy.
We can also expect to see more bankruptcies in the electronics and technology industry because many will lose significant income because of the Circuit City income and may not get paid for supplies already in Circuit City's possession. Brace yourself the Circuit City bankruptcy is going to be a rough ride for all us.