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PREIT President Pitches Mall Plan to Business Community

A "very exciting announcement" coming soon regarding PREIT's plans for the Moorestown Mall, he says.

Within the next few weeks, the owners of the Moorestown Mall will be able to make a big announcement revealing which restaurants they plan on bringing in should the referendums on liquor licenses pass in November.

Speaking before members of the Moorestown Business Association (MBA) Wednesday morning, Joe Coradino, president of mall owner Pennsylvania Real Estate Investment Trust (PREIT), said the company would soon make a “very exciting announcement” regarding the restaurants it’s recruiting.

“You’re going to be, ‘Wow,’” he said.

Coradino was remarking on speculation that PREIT, contrary to its claims of seeking “fine dining” restaurants, would only attract casual dining establishments, like Applebee’s or Ruby Tuesday’s.

“We envision it being at a higher level than Cherry Hill (Mall) in terms of the dining,” he said. “We envision it being something you would all say, ‘Wow, that’s what you’re doing at Moorestown Mall?’ It’s not about Applebee’s or Ruby Tuesday’s or some other restaurant that I wouldn’t eat at.”

Coradino made his case for why restaurants, and specifically those that serve alcohol, are needed at the mall:

  • Sales per square foot at Cherry Hill Mall vs. Moorestown Mall, roughly equal in 2008, are now about $560 and $370, respectively. Coradino said improvements at Cherry Hill, including the addition of several new restaurants, are directly responsible for the uptick in sales.
  • A number of high-end department stores—H&M, Banana Republic, Nordstrom, Bloomingdales—require the presence of restaurants in a mall before they’ll agree to locate there, Coradino said. Following the opening of the Nordstrom at Cherry Hill Mall, he said sales per square foot rose $420 to $564, a 33 percent jump.
  • He quoted information provided by ESRI, a data consultant, showing Moorestown residents spend $22 million a year at restaurants. Of that, $9 million is spent in Moorestown, the other $13 million is spent at establishments outside the township, Coradino said.

If that consumer spending was kept in Moorestown, he said, it would mean a higher assessed valuation on the mall property, which would in turn translate to higher property taxes and more revenue for the town, school and county—about $500,000-600,000 more on top of the $3.5 million PREIT pays now ().

PREIT has appealed its $110 million assessment the last three years. The appeal is still pending, but Coradino said, “I can tell you Moorestown (Mall) is overassessed. We’re paying too much. We think it’s probably (worth) $80 million.”

He also responded to skepticism about the validity of PREIT’s claim of a 20 to 30 percent vacancy rate at the Moorestown Mall.

A report PREIT filed with the U.S. Securities and Exchange Commission (SEC) shows the Moorestown Mall having a total occupancy rate of 91.2 percent—only an 8.8 percent vacancy rate.

However, the second column in the report indicates an 80.2 percent rate of occupancy for non-anchor (i.e. non-department) stores, which is what Coradino said the mall’s performance is truly based on.

“We look at the space between the anchors,” he said.

He also noted the Lane Furniture store, while vacant, is still paying rent, so PREIT counts it as “occupied” for the purposes of the SEC report.

No Plan B

Coradino fielded questions from the somewhat-larger-than-normal crowd at the MBA meeting, including Steven Pazienza, owner of the Mosquito Squad in Mount Laurel, who said he strongly supported PREIT’s plan, but wondered whether opening restaurants at the mall would suck some of the life out of the downtown.

“In the center of Haddonfield, the center of Collingswood … I think the businesses are hurting. I think the vacancies are really bad,” Pazienza said. “I see how these towns are being impacted (by the Cherry Hill Mall).”

Coradino had a different opinion though, suggesting, “There’s enough business for all of us. This is about how we can all succeed … What we do, I think, will drive the quality of restaurants up in downtown Moorestown.”

Another member asked what PREIT’s plan would be if the referendums failed, and Coradino’s answer was simple: “We don’t have a Plan B.”

He said they would probably move forward with plans to upgrade its theater. Tying the movie and restaurant concepts together, Coradino pointed to statistics from Screenvision, a theater advertising company, that 42 percent of moviegoers go out to eat before or after watching a movie and, according to trade publication Shopping Centers Today, 70 percent of diners shop during the same trip.

Asked what the timeline would be on opening restaurants should the referendums pass, Coradino snapped his fingers.

“We’re negotiating with restaurants right now,” he said.

PREIT estimates the addition of restaurants will create 150 temporary construction jobs and 200 hospitality jobs.

MBA president Mark Morgan said PREIT approached him to see if Coradino could speak at the membership meeting. Morgan took some heat for his decision from members of the community critical of PREIT for not holding a truly public forum, but Morgan didn’t understand the backlash.

“It would be a disservice to our members (not to let Coradino speak),” he said. “He talked about it being a business plan. Who better to talk to than the business association? Why wouldn’t we listen?”

In the Cheap Seats September 21, 2011 at 07:06 PM
Odd that there is no plan B. Their two other nearby malls have less occupancy than Moorestown currently and are still open, Plymouth Meeting and Echelon.
What's the Downside September 21, 2011 at 07:15 PM
The presentation was excellent! Can't wait to hear about the restaurants. How fast after election day can they pay the $4 million and start creating jobs?
Bill September 21, 2011 at 09:59 PM
Mr. Coradino's attempt to "explain" the discrepancy between the SEC report and the flier is not very convincing. First of all, the flier did not say the 30% figure was for non-anchor space only. It said the Mall has a 30% vacancy rate. That is not accurate. It is 8.8% vacant. Of course, the anchors pay substantial rent to the Mall so it is disingenuous not to "count" them. Even if one were to limit it to non-anchor space, the 30% figure in the flier is still 50% overstated. The flier did not say "the non-anchor space at the Mall is 20% vacant." If a tenant has left but is still paying rent, that is money in the Mall's till, which contributes to the income on which the Mall's assessment is based.
Walter September 21, 2011 at 11:25 PM
Hey Downside: thanks for asking my question to the mall chief. Instead of your obnoxious "what's the downside". You have the real question "What's the backup plan?". For him to say there is no backup plan is peculiar. Or is that another scare tactic ? We have no backup plan, the voters only have one choice? Huh? How many business go with one plan, "put all their balls into one sack". And claim they have no back up plan? Very few. I'm curious what that plan B is. Preit and mr C know well that the mall can fair well without liquor, and have other options.
Walter September 22, 2011 at 12:38 AM
With downside's plan going down on nov 8th, we the citizens if Moorestown want to know what the backup plan for our mall without the liquor? Retail isn't making it at the Ma so let's fill in that space with ideas of larger retail, adventure, sports, movies, exotic food Stores, etc. Preit and other malls have a plan to make their centers more vibrant without using liquor. Hmm I thought mr downside was on the inside? Why hold back?
SugarBaby September 22, 2011 at 02:46 AM
Funny how Preit is attempting to reframe Moorestown Mall like Las Vegas was saying, " This is a Family destination Resort Town " . What Family - The Mafia? Ha. Ha. Ha. It is ironic that PREIT is attempting to push "THEIR PROBLEM" onto Moorestown. Mr. Broder, Mr. Button, and COMPANY - Moorestown Town Council are to doops. Come election day, let the wind blow... blow... and it will all go away.
Mtown Talker September 22, 2011 at 11:31 AM
This is so set up. Is preit pulling the wool over Moorestown citizens eyes? I'm wow'd by your strategy. Let's tell them the big deal eateries and stores that would be coming weeks before the election day. And then think the citizens would be drooling over that "big announcement" and couldn't contain themselves over a couple of restaurants that the citizens would vote in preit's favor rather then their own towns favor. The citizens of moorestown are more smart then the "big announcement" strategy. We residents will vote NO to liquor licenses with a good majority of the vote.
Bob Dannheim September 22, 2011 at 01:02 PM
When on the eve of the vote, Preit is correctly focusing on their proposed plan. Introducing some theoretical "Plan B" at this time would be not only distracting, but pretty silly. Envision Plan A at work- restaurants equal or better than Cherry Hill; dozens of new businesses and restaurants contributing to our tax base; a new movie theatre. Envision the experience at Cherry Hill Mall, right here in Moorestown. Want a Plan B? The Mall gets sold off, revenues and taxes decline, vacancies abound. Envision the former Pennsauken Mart, no longer in business- there's your "Plan B". Let's embrace the future, enjoy a facility of the quality we deserve in our town, and recapture the revenues we so desperately need to support our schools and township alike.
Rob MacIver September 22, 2011 at 01:35 PM
Bill, one correction that is very relevant -- 20-30% is a more accurate vacancy number because, as at most regional shopping centers (especially at more mature ones like Moorestown Mall), the anchors do NOT "pay substantial rent to the Mall." In fact, at Moorestown Mall, only Boscov's and Sears are tenants under leases -- the Macy's and Lord & Taylor stores are actually owned outright by their respective operators. While anchor lease deals occasionally provide for a small amount of fixed minimum rent, usually at the outset, they mainly provide only for contingent rent, calculated as a percentage of the anchor's sales over a threshold amount -- a threshold that is frequently not achieved. Under this model, the main function and economic benefit of the anchor stores to the Mall owner is seen to be their ability to draw customers to the Mall. Anchors may also contribute a small share of the Mall's taxes and operating expenses, but even these payments tend to erode over time as deals are renegotiated.
Anonymous September 22, 2011 at 02:33 PM
I'm interested to see that if this does pass, how long it will take the "No" voters to eat at the new places or see a movie in the new theater, or if you plan on boycotting...
In the Cheap Seats September 22, 2011 at 03:36 PM
We see what the pro side did when they lost (by almost 2-1) last time. They ratcheted up their game, changed a few words on the referendum, hired fancy PR reps and tried again. If they don't succeed, is it possible for them to change the words again to say: "on bikes, rollerskates or helecopters" and then try again next year??
What's the Downside September 22, 2011 at 03:55 PM
Cheap - since you have nothing to offer factual as to why not, you have again resorted to cheap shots. I understand that your position and argument are weak but can you at least try to offer up something intelligent to support your position? I know its tough to be opposed to new businesses and jobs because who could be opposed to that with the economy in the state it is? And who really wants to turn away $4 million that would help keep teachers, firefighters and police employed? Is the alternative to raise taxes?
Mall Fan September 22, 2011 at 04:48 PM
Oh Bobby.. The plan to tell us what eateries or whatever is a suspicious plan too. Come on, by releasing questionable details about what "could" come (no guarantee) right befre the election ,sounds like a well rehearsed strategy. Ooh, baby on my toes waiting and and drooling as someone else said to know what eateries come. Ooh, even better than cherry hill, on my! This is becoming too obvious of preit's tactics. We Moorestonians won't be foed by that fluff and propaganda. I sure hope you're not being influenced by "them". Have a good day!
Bill September 22, 2011 at 06:36 PM
Mr. MacIver, nothing you say changes the fact that the flier was materially inaccurate and, I think, misleading. If the Mall wants to send a flier around that says the non-anchor space is 20% vacant and we think if we got liquor licenses we could fill some of those vacancies or we could get higher rents, that is fine. But any reasonable reader of the flier would conclude the 30% figure applies to the entire Mall -- because that is exactly what the flier said. I may call the anchor rent "substantial," you may regard it as insubstantial, but the fact remains that the Mall is only 8.8% vacant. The message of the flier was that if the Mall doesn't get liquor licenses, then residents will pay higher taxes. That is simply wrong.
Bob Dannheim September 24, 2011 at 11:25 AM
Aw, Mall Fan, you got your hooks into me again. Whatever, behind that fake name, I know you are a good person. Can I give you a ride when it's time to vote?
R. Ponselle September 24, 2011 at 05:42 PM
We won't intentionally boycott those places but we don't typically eat in chain restaurants and I expect that's what they mean when they refer to them as "fine dining." What a joke!
Mall Fan September 25, 2011 at 05:17 PM
Hey Bobby, thanks for your offer. I thought the political parties organize the rides? Also, others organizations may offer again this year? I understand a lot of people are upset the way this has been handled and some could have been swayed to vote for liquor but will either vote vote no or won't vote the referendum questions. You would offer a "NO" to liquor voter a ride? Thanks but I don't vote at the high school anymore. Appreciate you kind invitation . Hope you had a good weekend!
M.Verado September 25, 2011 at 09:29 PM
M.Verado 4:54pm on Sunday, September 25, 2011 Let's see, first the 4 million for the licenses was a lie, wasn't going to happen.. Now that it obviously is, either it isn't enough, or Council is fixing the price, or it's only $40. per household. If it were 50 million, it wouldn't satisfy some of you. You are against loquor PERIOD, no matter what the benefit could be. PREIT isn't a business trying to survive in an Obamoconomy, their selfish, corrupt, and don't give a damm about Moorestown. There are over three hundred restaurants in a 25 mile radius. Four more will kill us. As for bars in Lenola, or all over Main Street, how do you do that with only 4 licenses that will be owned by PREIT? The licenses CANNOT be transferred. The seating requirements are 150 persons. Read both the questions, and the statutes. There will be no liquor board (not required). Council has the sole authority to set the selling price for the licenses, PREIT merely offered 1 million each. Any expansion/ structural improvements to the Mall will be Taxed based upon their assessed value via the twp. assessor. Preit estimates $5 to 600,000. Add to that, the taxable value of the proposed 18 screen theater. It the twp. is paid 4 million for the licenses, why would the twp be paid again if PREIT sold them to someone else?
M.Verado September 25, 2011 at 09:29 PM
I suppose, now that PREIT has taken away almost all of your arguments, the only thing left to beat on is the vacancy rate. Why would PREIT have, or reveal a plan B, so you can beat them up on that too. Frankly, it's none of your business. I would really like to know the business background of some of the posters on this blogg. If they are in business, they have to be drowning. Like Downside, I'm still waiting for one undeniable FACT as to a proven negative of liquor at the Mall.
Mall Fan September 25, 2011 at 10:15 PM
Yeah, from looking at previous posts and blogs , it appears "downside" and "m.Verado" are the same person? Amazing they seem alike. It responds the same in both blogs with both names. Honestly, you (both screen names) sound desperate for the pro liquor side.

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