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From Physical Upgrades to New Merchandising, Owners Are Reimagining Philadelphia’s Shopping Centers

by Katie Sloan

Philadelphia is known for many things, from being the City of Brotherly Love to a city rich in history, art, culture and food. As a result, the region is desirable for many residents and visitors and has been recognized in real estate circles for its housing and retail development opportunities. 

Throughout the pandemic, greater Philadelphia has lent itself to commuters, residents, tourists and hybrid employers by providing convenient access to other East Coast cities, vast amenities and outdoor recreation spaces, as well as unique dining, entertainment and shopping experiences. 

Recognizing the need to continue catering to the remote employees, shopping center owners and developers see ample opportunity across the region, specifically within the inner suburbs. In these locations, there is a great mix of diversity, mature employment bases and irreplaceable real estate where developers can continually create long-term value through blended opportunities. 

Federal Realty has been reinvesting in the greater Philadelphia and Southern New Jersey region for the past decade, strategically transforming our portfolio. Our company focuses on the ownership, operation and redevelopment of high-quality, retail-focused properties, with a mission to deliver long-term, sustainable growth through investing in communities where retail demand exceeds supply. 

The strength of our greater Philadelphia portfolio has allowed us to partner with a leading healthcare system, pursue residential redevelopment and ultimately create destination shopping experiences that are the heart of the communities they serve. Through this involvement, we have seen several trends unfold within property transformations, merchandising and shopping center redevelopments.

Reimagining Retail Potential 

Population growth in the greater Philadelphia area remains steady. During the pandemic, we witnessed tremendous resilience and now see a strong renaissance within the inner suburbs. 

Over the last decade, we found that reinvesting in real estate to create elevated experiences and highly amenitized destinations was very important in driving consumer and tenant demand. These efforts have become increasingly critical in distinguishing and defining successful real estate long term during and post-pandemic.

When reinvesting in a shopping center, designing purposeful social and experiential opportunities for visitors is key. For example, we found it particularly important to incorporate amenities such as outdoor dining and lounge seating to complement existing eateries. 

Also, the addition of fireplaces for social gatherings and pedestrian-friendly trails or walkways lined with landscaping have been welcomed by the communities we serve. With more flexible work schedules and remote work habits taking root, these retail escapes now have broader appeal and use. Activating outdoor spaces not only benefits property transformations, but also offers a cost-efficient way to improve community health and wellness. 

Merchandising Insights 

While online shopping has increased due to the pandemic, e-commerce cannot be a substitute for the personal experiences that consumers crave and the critical daily interactions of communities. Flexibility and variety in retail offerings and formats make each property unique and desirable. Striking an important balance between convenience, community-focused merchandising and placemaking helps meet the demands of the consumer.  

The pandemic caused many stores to reinvent their business and become creative with sales by offering outdoor dining, curbside pick-up, BOPUS (buy online, pick up in-store) and expanded delivery options — services which are all here to stay. Developers will need to continue to plan for additional pick-up, drive-thru and other conveniences in future redevelopments to compete for tenant interests.

Understanding this trend, Federal Realty has created more than 100 curbside pick-up spaces across 4.5 million square feet in its Philadelphia/Southern New Jersey portfolio. Ultimately, well-located shopping centers that respond to the local consumer and tenant needs, including last-mile delivery solutions, BOPUS and destination shopping experiences, will continue to outperform.  


Similar to placemaking and merchandising, energy efficiency and sustainablility will be other important ways by which developers and landlords will distinguish themselves in this market and attract tenants and customers.

As construction and operations contribute to the rise in emissions, commercial real estate owners will play a crucial role in initiating change. Within the industry, we see increased efforts across the board to reduce environmental footprints. 

Specifically, there is considerable focus in today’s market on reducing greenhouse emissions, as well as water consumption and waste generation. We also have seen an increased focus from landlords on procuring their energy from more renewable and less carbon-intensive sources. 

Enhancing shopping centers can also increase wellness, stimulate local economies and design destination experiences to increase foot traffic and sales for tenants. Including solar panels, locally sourced building materials, sustainable transit and low-emitting building adhesives and sealants are all examples of green resources we have used in redevelopments.

Local Growth 

The regional retail outlook has unique opportunities, specifically as pertains to  the greater Philadelphia suburbs. As developers continue to provide new ways for residents to shop, it will be important to continue utilizing these trends to meet the demands of the community. 

By incorporating placemaking opportunities in property transformations, creating experiential moments and updating sustainability measures, owners, tenants and developers can thrive within this market.

Kari Glinski, Vice President of Asset Management for Federal Realty Investment Trust

This article was originally published in the October 2022 issue of Shopping Center Business magazine.

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