Half of Gallery's post-renovation mall space spoken for, developer says

Pennsylvania Real Estate Investment Trust has commitments from retailers, entertainment-venue operators, and restaurants for about half of the space at the outlet-center mall it is building at the Gallery at Market East site in Center City, chief executive Joseph Coradino said Thursday.

Planned at the shopping complex, to be called Fashion Outlets of Philadelphia, are two "flagship stores" of a "type that would be new to the Philadelphia market,"  as well as an "entertainment use" and "a number of off-price retailers," Coradino said during a PREIT earnings call with analysts.

He declined an analyst's request to be more specific, saying that the company was holding off on identifying tenants for the mall's 730,000 square feet of retail space to "make a really loud pop" when the names are announced.

Philadelphia-based PREIT, which owns Cherry Hill and Willow Grove Park malls among others locally, and Macerich, its Santa Monica, Calif.-based development partner, plan to compete the Gallery's rehabilitation in 2018 at a cost of at least $325 million.

The partners began building out the first phase of the Gallery revamp last month, after receiving a $10 million state grant they had been awaiting as part of their financing strategy.

During Thursday's call with analysts, Coradino also said PREIT is in negotiations with a buyer for its Beaver Valley Mall in Western Pennsylvania.  The company began marketing the property after Royal Dutch Shell announced earlier this year that it plans to build a petrochemical plant nearby, which is expected to be a boon to the local economy.

Coradino identified the mall's prospective buyer as a non-local entity with which the company is "familiar," but he declined to provide any other details about the transaction.

A Beaver Valley Mall deal is part of a years-long effort by PREIT to boost average sales across its portfolio by selling off lesser-performing malls. Coradino said Thursday that yet another property also was being put up for sale,  Crossroads Mall in Mount Hope, W.Va. 

Source: Philly.com