MERCEDES — Usually bustling with shoppers from across the region, the Rio Grande Valley Premium Outlet here now stands deserted, with barricades at the entrances and a lone security guard patrolling the parking lot.
With 140 stores and a handful of restaurants close by, the outlet earns 60-80% of Mercedes’ sales tax, according to City Manager Sergio Zavala. And the temporary closure of the city’s center of economic energy will surely be felt.
In an effort to contain the coronavirus, the doors of the outlet have been closed since March 17, along with nearly 200 other shopping centers across the nation owned by Simon Property Group. The La Plaza Mall in McAllen among them.
Zavala said the outlet is vital to the city’s stability since much of its budget plans depend on the outlet’s revenue.
“(The outlet) is extremely important for the city of Mercedes,” he said. “We rely heavily on their system — their sales tax and their success — because it offers good optics for the city overall.”
Zavala said a majority of the city’s sales tax is collected at the outlet, which opened in 2006.
“The outlet is instrumental to our economy,” Zavala said. “So, I am very anxious to see what happens when this virus situation passes and what it will be like when we reopen.”
He added that the city will meet next month with a financial advisor for the first of several budget-related workshops.
“We are in the middle of the fiscal year,” Zavala said. “So, it’s time to assess the situation. We rely on those sales taxes, especially during Spring Break and Easter.”
When Simon Property Group announced that they were temporarily closing its stores earlier this month, the company said it would only last until March 29 and reopen in time for Easter shopping. However, it is uncertain that the plan will go through.
When the outlet closed, there were about 6,300 diagnosed cases of COVID-19, according to CBS News, and none in Hidalgo County. As of Friday, there are more than 85,300 cases in the nation, nearly 30 of which in the Valley.
There has not been an update on whether Simon Property Group is going to open up again.
Zavala picked up lunch this week at the Whataburger that shares the same lot as the outlet. While waiting in the drive-thru line, he said that looking onto the empty lot gave him “mixed feelings.”
“Nobody likes to see an empty parking lot, especially of a pretty magnificent outlet center in the Mid-Valley,” he said.
“I am sad that it is not open, however, I do realize that there is a need for it to be shut down at this point and we appreciate the cooperation of private properties. I don’t like to see empty parking lots of the outlet, it’s a hard pill to swallow… but it is a necessary pill that we probably need to take at this time.”