Pennsylvania Real Estate Investment Trust (PEI - Free Report) — better known as PREIT — announced significant improvement in visitor footfall during the thanksgiving weekend at its recently unveiled redevelopment projects — Fashion District, Woodland Mall and Plymouth Meeting Mall.
Fashion District, located in Philadelphia, PA, provides dining, entertainment and immersive experiences for visitors, along with a wide range of retail offerings. Since the opening of the property, it has witnessed footfall of more than 2 million visitors in a period of just more than two months.
Backed by PREIT’s efforts to redevelop Woodland Mall in Grand Rapids MI, the property boasts big names like Von Maur, Urban Outfitters, Inc. (URBN - Free Report) , The Cheesecake Factory (CAKE - Free Report) , Tricho Salon and Black Rock Bar & Grill in its tenant roster. The mall has a mix of both national and local tenants and offers in-demand dining and high-quality retail. Notably, the mall traffic on Black Friday weekend was 29% higher than last year, and sales of many retailers surpassed targets.
Moreover, PREIT has been undertaking anchor repositioning efforts in the Plymouth Meeting Mall in Plymouth Meeting, PA. With this, the landlord ushered in new retail, dining and experiential concepts for consumers. Particularly, Burlington Store, Inc. (BURL - Free Report) , Dick’s Sporting Goods, Miller’s Ale House and Edge Fitness have come up with offerings in the space previously occupied by Macy’s. The mall, set at a thriving location in Philadelphia suburbs, experienced a 24% increase in traffic compared to prior-year’s Black Friday weekend.
Admittedly, aggressive growth in online sales, shrinking mall traffic, store closures and retailer’s bankruptcies have kept retail REITs, including PREIT, on tenterhooks. However, the companies are making efforts to enhance productivity of malls by trying to attract new and productive tenants, and discarding the non-productive ones. Further, retail REITs have been transforming their properties from traditional retail hubs into entertainment destinations by avoiding heavy dependence on apparel tenants, expanding dining options, recreational facilities and fitness centers.
PREIT resorted to dispositions of low-productivity assets, anchor repositioning, re-merchandising efforts, and high-impact redevelopment initiatives. Particularly, the company’s focus on adding dining and entertainment offerings are aimed at improving shopping experience and driving mall traffic.
Although such steps are likely to help PREIT efficiently tide over the lackluster retail real estate environment, portfolio-redevelopment measures require a considerable amount of capital investment, and tend to pull down margins in the near term.
PREIT currently has a Zacks Rank #4 (Sell).
You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Its shares have gained 0.6% compared with the industry’s growth of 0.7% over the past three months.
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