Main Street Complex has “embarked on an exercise to explore alternative strategies” to maximise returns on investment, as decreased footfall has negatively impacted sales and investment appetite, and is now impacting profitability.

This trend has also dampened investment confidence among retail operators, including some of the company’s tenants.

In a market update published through the Malta Stock Exchange, Main Street Complex plc issued details regarding 2024 trading activity.

While the company continued to operate profitably throughout 2024, maintaining a robust financial position with no external borrowing apart from normal trade credit, the Board observed that trading activity has generally subsided.

“Most likely [this is] impacted by the emergence of new malls throughout the island, leading to a reduction in footfall compared with the same period,” the company shared.

Competition has ramped up in the retail shopping market, with Mercury's Shopping District opening its doors in November 2023 and The Shoreline Mall opening in March 2024.

In the company’s annual financial statements for 2023, the Board had shared that recent refurbishments had been motivated by increasing competition in the market. It said that the company had embarked on a phased refurbishment and a unit reconfiguration program aimed at refreshing its image “with the aim of strengthening its appeal to potential tenants and customers.”

At the time, it also commented that some of the current tenants had expressed interest in extending their concession agreements while were undecided or intended to honour the current term of their agreement.

Now, the Board shared that a small number of concession agreements have expired and are yet to be replaced.

“Efforts to line up potential prospective tenants in case of non-renewals have met with moderate interest to date,” it added.

Furthermore, most concession agreements are due for renewal at the end of 2025, and discussions with existing as well as prospective tenants are underway. While a number of existing tenants have shown interest in renewing their agreements, “others remain undecided in view of concerns about the aforesaid rising competition in the retail sector.”

Despite the “prevailing and anticipated market conditions,” the Board remains optimistic about the prospect of Paola continuing “to serve as an important and attractive commercial and residential hub in the south of Malta.”