Recent retail store closures are pushing underperforming "C-class" malls into heightened distress, but the shops that remain, such as Gap (GPS - Get Report) and L Brands (LB - Get Report) , are riding on their downfall.

As retailers such as Macy's (M - Get Report) and Limited Stores close failing locations - in The Limited's case, all stores were shuttered last week - in primarily "C" malls, which target cash-strapped consumers through bargain brands, the shops that remain have an opportunity to re-negotiate the price of their rent to their benefit, said Morgan Stanley analyst Jay Sole in a note Wednesday evening.

"We can't remember a time over the past 10 years when the companies we cover were so consistently citing lower rents," Sole said. "However, as retailers leave malls, particularly anchor tenants, co-tenancy lease clauses are coming into effect for remaining stores and this is giving retailers big negotiating leverage. We think this is helping companies hold down expenses and maintain cash flow even as C malls become less viable."

That's good for the retailers, and not so good for the C malls themselves, Fitch Ratings analyst David Silverman told TheStreet.

"Certainly any kind of rent reduction would be helpful" to struggling retailers while "C malls, and mall real estate investment trusts, on the other hand, are certainly not rejoicing," Silverman said

Silverman said some of the retailers that may be able to negotiate their rent expense down include Gap; Victoria's Secret parent L Brands; Ascena Retail (ASNA - Get Report) , the operator of girls clothing stores Justice, and Tailored Brands (TLRD - Get Report) , the company behind The Men's Wearhouse.

Meanwhile, in the midst of "C" malls' lower rent expenses and flat-out depleted foot traffic, mall REITs, including Chicago-based General Growth Properties (GGP) , will see a negative effect on free cash flow, Silverman said.

In order to save their underperforming malls, REITs will have to reinvent them, by turning them into "hybrids," meaning instead of just filling open space with retail stores, they will likely push to open company and medical offices, theaters and restaurants, he said.

Still, Silverman said he expects more closures of "C" malls in 2017 and beyond, while "A-class" malls, which target upper-class consumers with high-end stores, are anticipated to remain.

Shares of General Growth Properties fell 12 cents, 0.5%, to $24.77 on Friday afternoon.