PHILADELPHIA (WPVI) — PREIT, the organization that owns several major malls across the Delaware Valley, filed for bankruptcy on Monday for the second time since the pandemic. Part of the filing includes the sale of the Fashion District Philadelphia in Center City. This is the second time in three years that Pennsylvania Real Estate Investment Trust — commonly referred to at PREIT — has filed for bankruptcy to reduce its debt despite redevelopment efforts of the Fashion District a few years ago.
Although some malls are doing better than others, companies face the challenge of redefining the mall experience as consumers continue to turn to Amazon and other online options. This, as mall owners took big hits during pandemic-related closures and as major anchor stores closed more locations with a focus on online sales.
While PREIT’s portfolio still includes local shopping centers like the Cherry Hill Mall, Plymouth Meeting Mall, and Willow Grove Park, this most recent Chapter 11 filing gives full ownership of the Fashion District to Santa Mónica-based developer Macerich. Although there is no public knowledge of a solid plan or a contract being signed, future plans for this property could include a billion dollar NBA arena for the 76ers.
Now, with one company taking full ownership of the Fashion District, it brings attention to whether those plans would still be an option at the site. Developer David Adelman doesn’t seem too worried after posting to social media that the restructuring does not impact their ability to deliver a new arena and residential high-rise. Arena developers still appear to be keeping with the goal to begin tearing down the Fashion District in three to four years. Although, it still has be approved before any of that can happen.
The Fashion District is also now listed on Macerich’s website as a property that has spots available to lease. For now though, PREIT officials have notified tenants, vendors and employees at the Fashion District that they would not be impacted by this development anytime in the near future. Meanwhile, many shoppers say shopping online is simply too convenient to resist while others said they still enjoy going to the mall.
“I prefer walking into the store because online you have to wait. I’m impatient,” said Samara Wilson, of Fairhill.
“It’s mostly online for me. I live out in Exton. The Exton Mall is pretty much empty, so if you go to the mall, you go to King of Prussia,” said John Connor.
“Half the stuff I just order online because I don’t got time,” added Grace Presley, of North Philadelphia.
According to published reports, officials from PREIT are hopeful this financial reorganization, including shedding Fashion District property, will reduce its debt load by $880 million, putting its other properties in a better position to compete with the world of online shopping.
Source: 6abc
