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Old 07-17-2017, 01:05 PM
 
Location: It's in the name!
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Quote:
Originally Posted by DoughLow805 View Post
Macy's news, Macy's backstage conversion on the 3rd floor of the current Macy's...so that's at least a start with a partial store renovation

https://www.bizjournals.com/washingt...oncept-to.html
Or not. BUt I agree, it's a start. It also signals that the Macy's at MPG is not going anywhere anytime soon. No shame in having a Backstage. Perhaps they could focus more on the upscale stuff in the other parts of the store. WE'll see.

Can't wait to hear about other new concepts coming to the mall. Especially the family sit-down restaurant that signed a lease.
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Old 07-17-2017, 01:08 PM
 
Location: It's in the name!
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IN other Hyattsville news, Pizzeria Paradiso and Art Works Now officially opened in their new Hyattsville building this weekend. Is a nice little spot.
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Old 07-17-2017, 02:05 PM
 
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Originally Posted by EducatedBro82 View Post
Macy's have different tiers... Macy's in PG Mall is different than Macy's at Bowie TC and both are lower tiers than the Macy's in Annapolis and Columbia. If development/gentrification improves; which it is; Macy's will then overhaul and upgrade the inventory to reflect the development.
Quote:
Originally Posted by DoughLow805 View Post
Macy's news, Macy's backstage conversion on the 3rd floor of the current Macy's...so that's at least a start with a partial store renovation

https://www.bizjournals.com/washingt...oncept-to.html


Well it looks like it won't be upgraded. But they could refresh the store with new carpet and better lighting, esp. if they want to compete with the TJMAxx
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Old 07-17-2017, 02:23 PM
 
Location: It's in the name!
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Originally Posted by lookingbutnotlost View Post
Well it looks like it won't be upgraded. But they could refresh the store with new carpet and better lighting, esp. if they want to compete with the TJMAxx
I think it will be upgraded. PREIT is putting a lot of money into rebranding and renovating the mall to be an A class mall. They can require Macy's to invest in updates as well as part of their lease requirement. OR there could be a deal where PREIT upgrades the store shell itself. I'm not sure there the responsibility lies with when it comes to leases. I assume the overall building including store shells is the responsibility of the owner to upgrade. I guess it depends on how the lease is written out.

PREIT doesn't necessarily need Macy's to stick around as it already has a strategy to replace any Macy's that closes. Also, I'm not sure how relevant Macy's is in that neighborhood. Hyattsville is trending toward a younger demographic with all of the TOD. Macy's was smart to develop a TJ Maxx type concept.

Last edited by adelphi_sky; 07-17-2017 at 02:43 PM..
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Old 07-17-2017, 02:40 PM
 
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Quote:
Originally Posted by adelphi_sky View Post
I think it will be upgraded. PREIT is putting a lot of money into rebranding and renovating the mall to be an A class mall. They can require Macy's to invest in updates as well as part of their lease requirement. OR there could be a deal where PREIT upgrades the store shell itself. I'm not sure there the responsibility lies with when it comes to leases. I assume the overall building including store shells is the responsibility of the owner to upgrade. I guess it depends on how the lease is written out.

PREIT doesn't necessarily need Macy's to stick around as it already has a strategy to replace any Macy's that closes. Also, I'm not sure how relevant Macy's is in that neighborhood. Hyattsville is trending toward a younger demographic with all of the TOD. Macy's was smart to develop a TJ Mazz type concept.
If I'm not mistaken, the mall renovation for the front end was expected to be completed this year by December, I'm not sure if that is on schedule right now, it seems pretty far behind imo. They've really only worked on 1/4 of the mall and that isn't even completed. But, I know at one point I saw some mock ups of a renovated back of the mall as well, including a parking deck, etc but that was not included in the 2017 plans. Since Macy's is on the back end of the mall, perhaps they'll do it then.
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Old 07-18-2017, 08:13 AM
 
Location: It's in the name!
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Quote:
Originally Posted by DoughLow805 View Post
If I'm not mistaken, the mall renovation for the front end was expected to be completed this year by December, I'm not sure if that is on schedule right now, it seems pretty far behind imo. They've really only worked on 1/4 of the mall and that isn't even completed. But, I know at one point I saw some mock ups of a renovated back of the mall as well, including a parking deck, etc but that was not included in the 2017 plans. Since Macy's is on the back end of the mall, perhaps they'll do it then.
I wouldn't say it's far behind. Most of the structure will remain. And while this is more plastic surgery than lipstick on a pig, I don't think it will take more than 5 months. From what I've seen, Target, TJMaxx, and the rear mall exteriors will remain untouched, which doesn't leave much to renovate on the outside in front.

I think the interior will definitely be done before December with Black Friday, Christmas, etc.

I do agree that as the third phase of Belcrest Plaza redevelopment gets underway (perhaps 4 years from now) directly behind the mall, the rear of the mall will get a face lift. You can't have market rate luxury apartments facing the butt of a 50's era mall. It's just ugly back there. THere is enough parking lot in the rear to create two parking decks. THat's more palatable. Then that would free up the front of the mall for the vision of the PG Plaza TDDP to have mixed-use structures take over the parking lots facing 410.

I'm waiting for them to replace that god awful Capital One Bank. It's hideous. They could take a space inside the mall. ANd getting to it by car is a nightmare.

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Old 07-18-2017, 09:06 AM
 
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Quote:
Originally Posted by adelphi_sky View Post
I think it will be upgraded. PREIT is putting a lot of money into rebranding and renovating the mall to be an A class mall. They can require Macy's to invest in updates as well as part of their lease requirement. OR there could be a deal where PREIT upgrades the store shell itself. I'm not sure there the responsibility lies with when it comes to leases. I assume the overall building including store shells is the responsibility of the owner to upgrade. I guess it depends on how the lease is written out.

PREIT doesn't necessarily need Macy's to stick around as it already has a strategy to replace any Macy's that closes. Also, I'm not sure how relevant Macy's is in that neighborhood. Hyattsville is trending toward a younger demographic with all of the TOD. Macy's was smart to develop a TJ Maxx type concept.
Just curious, is it easy for a mall to turn around and become an A class mall, quickly? Pardon my ignorance, but does this basically mean it is considered upscale and therefore caters to higher income groups? So do they expect a significant shift in local clientele?
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Old 07-18-2017, 09:40 AM
 
Location: It's in the name!
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Originally Posted by cp37 View Post
Just curious, is it easy for a mall to turn around and become an A class mall, quickly? Pardon my ignorance, but does this basically mean it is considered upscale and therefore caters to higher income groups? So do they expect a significant shift in local clientele?
An A class mall is determined by sales per sqft. THese classes are driven mostly by investors and how they determine which malls will give higher returns. So, while a mall doesn't necessarily have to be upscale to be considered class A, each store would have to sell enough together to total $500/sqft or more for the mall. Can you get that with a bunch of discount stores? Maybe, but you would have to probably add some upscale stores to lift that total above $500.

You could have a case where the mall is all discount stores but the amount of traffic could be high enough to where the stores are flipping inventory at a high rate driving up those sales per square foot. From what I've seen, MPG is almost never empty of foot traffic.

Right now, MPG is considered B/B+ mall. So, the owners don't have that far to go, which is why they are investing money into making the mall more attractive for more upscale stores. It seems to have worked to some degree with the recent retail announcements.

They do expect a shift in clientele. There is moderate gentrification going on around the mall. The low-income housing behind the mall is being replaced with market-rate upscale housing over the next 10 years. This is also evident across 410 at the new development next to Home Depot with homes starting in the $300s to $400s.


Doing a little research, Class A malls also have some upscale offerings. But I don't know if the sales are because those stores are there or that the stores came because there was already high sales at the mall. But here is a chart that contains mall ratings.




Quote:
This is from PREIT's 10-k filing:

Portfolio Stratification

Premier Malls
When listing our malls in order by individual property 2015 sales per square foot, there is a group of six malls at the top of that list that collectively had 2015 average sales per square foot of $565, average non anchor occupancy of 97.1% as of December 31, 2015 and contributed approximately 34.6% of our NOI in 2015. This “Premier” group includes such properties as Cherry Hill Mall in Cherry Hill, New Jersey and Willow Grove Park in suburban Philadelphia, Pennsylvania. Excluded from the figures above is Springfield Town Center, a mall in Springfield, Virginia which we consider a Premier Mall, however, since we acquired this property in 2015, it is not part of our “Same Store” properties, which are properties that have been owned for the full periods presented and exclude properties acquired or disposed of or under redevelopment during the periods presented.

Core Growth Malls
The next 17 properties on our list are a collection of solidly performing properties that had 2015 average sales per square foot of $380, average non anchor occupancy of 93.1% as of December 31, 2015 and contributed approximately 45.8% of our NOI in 2015. We divide this “Core Growth Malls” group further into “Core Growth Malls- Major Markets” and “Core Growth Malls- Market Dominant.” The Core Growth Malls- Major Markets group consists of malls that are located in the top 50 metropolitan statistical areas (“MSAs”) such as Philadelphia, Pennsylvania and Washington, DC, and includes such properties as The Mall at Prince George’s and Francis Scott Key Mall in the Washington, DC MSA, and Moorestown Mall and Springfield Mall in the Philadelphia MSA. The Core Growth Malls- Market Dominant group consists of malls that are located in other MSAs, and includes such properties as Viewmont Mall in Scranton, Pennsylvania, Capital City Mall located near Harrisburg, Pennsylvania and Wyoming Valley Mall in Wilkes-Barre, Pennsylvania.

Last edited by adelphi_sky; 07-18-2017 at 10:09 AM..
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Old 07-18-2017, 10:10 AM
 
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Great information, thanks so much for your response!

So I see that the mall is close to getting the returns it needs, to make the owners happy. When I saw "A class", I was kind of hoping for something more like Montgomery Mall, but maybe the transformation will not be so dramatic.
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Old 07-18-2017, 10:39 AM
 
Location: It's in the name!
5,608 posts, read 6,388,099 times
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Quote:
Originally Posted by cp37 View Post
Great information, thanks so much for your response!

So I see that the mall is close to getting the returns it needs, to make the owners happy. When I saw "A class", I was kind of hoping for something more like Montgomery Mall, but maybe the transformation will not be so dramatic.
Yeah, Not on that level. But I imagine it could get close over the next 20-30 years if gentrification continues on its current pace. There is over $1B in investment going on in the trade area. College Park is quickly becoming a top college town with a premier research park, the Riverdale Park development has Whole Foods of course. The incredible wave of gentrification in D.C. is marching eastward and will collide with what is going on in Hyattsville and Mt. Rainier and the Arts District.

THe Purple Line will just accelerate gentrification along University BLVD. So, the end result may be a mall with a few premier retailers that you see at Montgomery Mall.

All of this doesn't even include Montgomery COunty's new Life Sciences research development going on just across the line. Currently, the Mall at Prince George's would be the closest regional mall. THat's a LOT of development going on in the area for the mall to remain a B mall.

Last edited by adelphi_sky; 07-18-2017 at 10:53 AM..
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