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I know Kate Spade, Michael Kors and White House Black Market where the top three stores actively trying to get space in Center City. Wonder if it will be one of them.
Just wondering, any word of a potential Hugo Boss store coming to Center City??
Looks like the Victoria's Secret on Chestnut just closed (next to the Moe's that closed).
Makes sense. There is another one down the street in the Shops at Liberty Place. Really never understood why there were two a block away form each other.
I would love to see a Bloomingdales at Cherry Hill Mall though. that mall is turning into a smaller King of Prussia now with all of the new retail selection. Though Nordstrom is very nice, I bet federated would would have changed their mind if they saw how successful that mall currently is. If CH had Macys, Nordstrom, Bloomingdales anchoring, that would be awesome.
At this point, that'd happen if JCPenney there closed and macy's moved to JCPenney's spot and macy's opened bloomingdale's at the prime 38 facing spot (i.e. the current macy's spot). The macy's in CH does too well for macy's to just convert it without being elsewhere in the mall. However, I don't see macy's wanting to mess it's presence in CH (i.e. shifting spots), and I can't see bloomingdale's at the JCPenney spot. The JCPenney side of the mall is very middle income at best and doesn't lean upscale at all. (e.g. stores like Kicks USA and the foodcourt)And this is all assuming JCPenney will close at CH, which is too much of a presumption. JCPenney would likely keep CH and Deptford, but close Cumberland, Hamilton and Burlington Center, that is the weaker malls over the strong mall sites in So. NJ.
When Boscov went bankrupt, it closed out of many malls where it was a 4 dept. store rivalry, such as Oxford Valley and Montgomery Mall and malls in Baltimore in the same situation, but kept open at malls where it was less competition. The point being is that it knew to keep sites where in the long term, it would prove more advantageous. For Boscov, it meant sticking in malls with less competition. For JCP, it could mean sticking in the power center malls.
Regarding a 3rd Bloomingdales for the Philadelphia region:
Another likely more viable possibility than bloomingdales in the Gallery, is if Macy's Inc. (formerly known as Federated) decided that the macy's in Moorestown Mall convert to bloomingdales. It's a newish building and it would be adjacent to Lord&Taylor there, another upscale tenant. That mall is gaining 4 new restaurants with liquor licenses and a new Regal theater.
macy's will still be in CH Mall, where it's very successful, as well as Voorhees Town Center Mall, Neshaminy, Oxford Valley and Quakerbridge. One of those sites wouldn't be too inconvenient for most of Burlington County, but it wouldn't be as local.
I don't think macy's would have any interest in re-opening at Burlington Center Mall.
Regarding the Gallery, Target is the most realistic and best bet IMO.
Regarding the Gallery, Target is the most realistic and best bet IMO.
Over the past few years PREIT has spent something like a quarter of a billion dollars to buy the gallery and adjacent properties with the intention to totally redo the mall.
I mean to put that in perspective PREIT has already spent roughly half the amount the comcast center cost to build simply on acquisition! Who knows what the costs will be to renovate the gallery, but the point is overall the costs PREIT is sinking into the gallery are astronomical.
Just last week they purchased another adjacent property for 60 million. You really think all of this investment is being made with the end goal of luring in a Target?
The gallery as it exists today is a dump, but it is in the center of 6 million person metro with great transit access, is very close to hotels, convention center, the very popular tourist attraction in old city, etc. It has the potential to be something much more than what it is. PREIT obviously sees this, and that is why they bought it and all the adjacent properties that they did. They clearly have big plans considering the size of their investment, Target is okay, but it's not worth this type of investment.
Over the past few years PREIT has spent something like a quarter of a billion dollars to buy the gallery and adjacent properties with the intention to totally redo the mall.
PREIT's plans aren't clear in that "redo". If it's a full demolition of the Gallery and then build from the ground up, there maybe more potential. But that's doubtful.
A great number of stores will stay there and continue paying rent, and minimal disruption is generally the ways things are done. They want rent money still coming in during a renovation. Once it's done, rent goes up, weeding out the lower tier tenants it doesn't want anymore.
Even CH Mall renovation was mainly a sprucer up kinda of investment (new flooring, moving the foodcourt around) and new things added around the mall but the core doesn't change that much. CH still has an old office building in its premise just occupying valuable space, a clunky design and 2 levels in two separate parts of the mall, and not uniform, and a weak JCPenney side. Full demolition and build from scratch (except for the anchors) doesn't happen.
The renovation being primarily cosmetic, leasing strategy changes, moving the foodcourt to the second level, and possibility of converting the Kmart which bisects the mall into mall space would be more realistic at the Gallery. Bloomingdales is still an outlandish fit in that area.
Location: NYC based - Used to Live in Philly - Transplant from Miami
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Quote:
Originally Posted by Summersm343
Makes sense. There is another one down the street in the Shops at Liberty Place. Really never understood why there were two a block away form each other.
It does make sense, but it makes Chestnut looks more deserted. Puma, Moe's, and now this? I feel like we are gaining one retail in Rittenhouse (SuitSupply), and we lost three. That sucks!
PREIT's plans aren't clear. If it's a full demolition of the Gallery and then build from the ground up, there maybe more potential. But that's doubtful.
A number of stores will stay there and continue paying rent, and minimal disruption is generally the ways things are done. They want rent money still coming in during a renovation.
Even CH Mall renovation was mainly a sprucer up kinda of investment (new flooring, moving the foodcourt around), etc. That'd happen likely with the Gallery with the possibility of converting the Kmart which bisects the mall into mall space. Bloomingdales is still an outlandish fit in the Gallery.
Full demolition? That obviously is not happening nor is it needed. The one fundamental flaw with the gallery's design is the lack of retail facing the street, i mean even CH Mall is better in this respect as all the stores have entrances directly outside as well as interior entrances. That will have to be done if the Gallery is going to be successful but it will hardly require the demolition of the entire structure.
Other than that, what is fundamentally flawed in the Gallery's design that would prevent it from attracting higher level retail? I mean honestly a face lift that improves the aesthetics of the building would be really nice, and is obviously a prerequisite to attracting better tenants. But honestly that's not the biggest road block to attracting better tenants. There are two big problems with the mall, one is an abundance of retail that is very low rent, businesses that have no place in a regional shopping destination. I mean there are multiple check cashing places at the Gallery.
The other big problem is the perception of the Gallery... namely that it is a low rent dump.
Neither of these problems is insurmountable. PREIT already has basically all of the tenants going month to month with the bigger ones year to year. Once they decide it's time to get busy, they can easily clear all of the low rent tenants out. Changing the perception will be harder, but if done right will be a natural change as the mall is renovated and new, higher end stores are brought in.
I'm not saying bloomingdales is coming to the gallery. I'm saying it's far from outlandish and higher end department store is definitely being wooed to the gallery. Honestly I think it's outlandish that you think that PREIT is doing all of this just to attract a target. Target has no problem moving just about anywhere, under highways, in the middle of nowhere, 5 blocks from another target. I mean honestly I don't feel PREIT would have to work very hard to attract a Target. If that was there plan why buy all the adjacent buildings? They got the gallery for a song (less than $50 mill) why not just throw some paint on that bring in a target and call it a day? Why would they continue to then spend many times the purchase price of the entire gallery to buy adjacent buildings.
Again not saying a bloomingdales is coming to the gallery. I have no idea what department store will end up there. All i know is that it makes ZERO sense that PREIT would make such a hefty investement if all they were planning to do was basically run a marginally better version of the gallery that included a target.
Full demolition? That obviously is not happening nor is it needed. The one fundamental flaw with the gallery's design is the lack of retail facing the street, i mean even CH Mall is better in this respect as all the stores have entrances directly outside as well as interior entrances. That will have to be done if the Gallery is going to be successful but it will hardly require the demolition of the entire structure.
Other than that, what is fundamentally flawed in the Gallery's design that would prevent it from attracting higher level retail? I mean honestly a face lift that improves the aesthetics of the building would be really nice, and is obviously a prerequisite to attracting better tenants. But honestly that's not the biggest road block to attracting better tenants. There are two big problems with the mall, one is an abundance of retail that is very low rent, businesses that have no place in a regional shopping destination. I mean there are multiple check cashing places at the Gallery.
The other big problem is the perception of the Gallery... namely that it is a low rent dump.
Neither of these problems is insurmountable. PREIT already has basically all of the tenants going month to month with the bigger ones year to year. Once they decide it's time to get busy, they can easily clear all of the low rent tenants out. Changing the perception will be harder, but if done right will be a natural change as the mall is renovated and new, higher end stores are brought in.
I'm not saying bloomingdales is coming to the gallery. I'm saying it's far from outlandish and higher end department store is definitely being wooed to the gallery. Honestly I think it's outlandish that you think that PREIT is doing all of this just to attract a target. Target has no problem moving just about anywhere, under highways, in the middle of nowhere, 5 blocks from another target. I mean honestly I don't feel PREIT would have to work very hard to attract a Target. If that was there plan why buy all the adjacent buildings? They got the gallery for a song (less than $50 mill) why not just throw some paint on that bring in a target and call it a day? Why would they continue to then spend many times the purchase price of the entire gallery to buy adjacent buildings.
Again not saying a bloomingdales is coming to the gallery. I have no idea what department store will end up there. All i know is that it makes ZERO sense that PREIT would make such a hefty investement if all they were planning to do was basically run a marginally better version of the gallery that included a target.
You're undervaluing/underestimating Target.
Any major redevelopment effort like this will be financed. Typically with new skyscrapers, new malls, etc. the financial institutions (i.e. banks) want to see that it will be a good investment, and often rely on something more concrete, like anchors and credit worthy tenants that are committed and have signed leases to occupy a significant amount of space.
While PREIT pursued CH Mall renovation prior to Nordstrom signing on board, it had Macy's, JCPenney, and a number of high end stores already in the mall, including J Crew and Banana Republic. It also had Crate & Barrell that agreed to join the mall, and The Container Store soon afterwards, which happened before the cleanup inside. PREIT was going to go ahead and make an outdoor lifestyle component, but eventually got Nordstrom on board.
I really don't think Bloomingdales or another high end store will be first and foremost here. Without that, financing the redevelopment becomes difficult.
Target is an ideal tenant. They suit very well in Chicago. They were lured in successful malls including the Christiana Mall.
If PREIT can get Target and perhaps Macy's onboard, to open a Macy's back at Strawbridge's site, it'd be an ideal and realistic mix, and the banks would be receptive to finance a major redevelopment project for the Gallery. Macy's could then convert it's other site closer to Rittenhouse to a Bloomingdales.
Target probably wants Kmart out. Kmart has the best spot in the mall, smack in the middle of everything, but Kmart is a laggard. For PREIT's purposes, it doesn't need 3 anchors. 2 is fine and the middle can be converted to mall space, where it can make money from many tenants.
Last edited by avg12; 05-02-2013 at 09:47 AM..
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