American Eagle has filed a lawsuit against Westfield San Francisco Centre, alleging Westfield has neglected its obligations as a landlord. This led to a surge in mall criminal activity and created an unsafe environment for employees and customers.
American Eagle's lawsuit accuses Westfield of allowing the San Francisco Centre mall to "deteriorate into disarray." The retailer claims that Westfield breached its lease agreement by neglecting common areas in the mall, which has resulted in American Eagle employees having to deal with gun violence, physical assaults, burglaries, and robberies.
The lawsuit further alleges that Westfield has been negligent in maintaining security and management responsibilities as outlined in their lease agreement. Between May 2020 and May 2023, American Eagle reported over 100 significant security incidents at the store, including customers brandishing weapons and verbally assaulting staff.
The retailer also accuses Westfield of turning a blind eye to these issues, shifting all blame to the city of San Francisco while failing to take responsibility for its role in the mall's decline. This alleged neglect has left American Eagle and its employees to bear the brunt of the escalating crime rates and deteriorating conditions at the mall.
The lawsuit comes when the San Francisco Centre has seen a significant drop in foot traffic and sales. According to Westfield, total sales fell from $455 million in 2019 to $298 million in 2022, and foot traffic plunged from 9.7 million visits in 2019 to 5.6 million in 2022.
This decline in sales and foot traffic has been attributed to challenging operating conditions in downtown San Francisco, including a rise in homelessness, high rents, and an increase in remote work and online shopping. However, American Eagle's lawsuit suggests that Westfield's neglect has also significantly affected the mall's decline.
American Eagle now seeks compensation from Westfield for "damages caused by its failures and broken promises." The retailer signed its lease with Westfield in 2017, which runs through 2028.
This lawsuit serves as a stark reminder of the challenges faced by retailers operating in urban centers. As crime rates rise and conditions deteriorate, retailers are left to grapple with the impact on their operations and the safety of their employees and customers. It remains to be seen how this lawsuit will unfold and its implications for other retailers operating under similar conditions.
