Phiadelphia — New retail deals show a continued interest in Center City.
Philadelphia — Center City has seen a resurgence in retail activity in the last few years, making Philadelphia one of the brightest spots for retailers in the U.S.
South and west of City Hall, to Rittenhouse Square, Center City has seen a boom in upscale retail and restaurants. Meanwhile, east of City Hall, every day retail is gathering steam. PREIT has plans to redevelop its Gallery at Market East in Center City, and this has piqued a lot of further interest from retailers. Marshall’s, a division of TJX Companies, announced in January that it will open a 26,000-square-foot location in a space currently occupied by Staples directly across from the Gallery at Market East (Donna Drew of Metro Commercial represented Marshall’s, while Michael Katz of Jenel Management Corp., represented the landlord; TJX’s Mark Hernon directed the deal).
Meanwhile, Walnut Street — Center City’s high street shopping district — and its surrounding streets continue to pick up additional retailers who want to capture the city’s affluent residents (Philadelphia has the third largest CBD residential population following New York and Chicago). Center City District estimates that a business located on the 1400 block of Walnut Street can expect to see an average of greater than 2,000 people per hour. The Center City District estimates retail demand within one mile of City Hall is $710.9 million per year. Center City has a population of nearly 180,000, 73% of which have at least a bachelor’s degree.
“(Center City) Philadelphia is one of just a few cities in the entire country that offer retailers extremely high pedestrian traffic, excellent demographics and very strong economic drivers,” says Jim Pearlstein, president of Pearl Properties, who owns a number of properties in Center City, and who has been a catalyst in Center City’s renaissance. “Coupled with a national sustainability movement/desire to live the urban lifestyle — thousands of additional residents/shoppers are moving into Center City each year — retailers are now experiencing similar results to New York, San Francisco, Washington and Boston. In the last year alone, we have seen new stores open from Apple, Le Pain Quotidien, Barbour, Brooklyn Industries, Free People and Jack Wills.”
Philadelphia’s strong restaurant scene, which has spawned celebrity chefs Jose Garces and Stephen Starr, continues to grow in stature and notoriety, with many of the city’s restaurants branching out to New York, Chicago and other large urban markets.
For its part, the city of Philadelphia and agencies like the Center City District and the Philadelphia Industrial Development Corporation, are constantly working on the city’s retail. In addition to promotion of Center City as a retail location, their efforts include fostering infrastructure improvements, like $6 million in streetscape improvements in and around Center City, and a commercial advertising district, which gives developers permission to install lighted and digital signs on their buildings in a certain area of Center City. Plans are also underway for a $55 million renovation of Dilworth Plaza at City Hall, a gateway to Market Street East that connects the east side of Market Street to the West side.
Photo: Walnut Street retail courtesy of Peter Tobia for the Center City District.