One of Moorestown Mall's entrances.
When Moorestown Mall was a month from opening, the builder predicted the project at Route 38 and Lenola Road would embody the future of retailing.
The mall "sets a pattern for enclosed mall shopping centers for perhaps 25 years to come," the president of realty firm Winston-Muss said in the Courier-Post in August 1963.
That prediction made the mall — with anchor department stores Wanamaker's and Gimbels and about 75 other tenants — a trendsetter into 1988.
But it's 2021 now. Wanamaker's and Gimbels are long gone, as are three of the mall's four most-recent anchor tenants: Macy's, Sears and Lord & Taylor. Now Boscov's remains as the sole anchor store. Add the devastating effects of online shopping and the COVID-19 pandemic and you have a poor investment in the form of more than 1 million square feet of leasable space sitting on about 86 acres.
Boscov's is the only anchor store left at Moorestown Mall. Three others are gone.
"Moorestown Mall is at a critical juncture," current owner Pennsylvania Real Estate Investment Trust (PREIT) states in a Moorestown Township report on the property. "Redeveloping the center and adding complementary uses will support the mall, stabilizing, and improving its performance," Philadelphia-based PREIT, which bought the property in 2003, said.
The Moorestown Planning Board Thursday night will hold a virtual public hearing to help determine if the mall is an "area in need of redevelopment," a designation that under state law permits municipalities to offer tax breaks on property improvements. PREIT on January 11 announced it plans for as many as 1,065 multifamily units and a hotel at the site to shore up its troubled mall investment.
Members of the public can watch the meeting on livestream, but must use the telephone to join the meeting and make comments, according to the township. The agenda has instructions on how to watch or join the meeting by telephone.
Moorestown Mall is the fourth-largest enclosed mall in South Jersey. The largest is the Cherry Hill Mall, which is two years older than Moorestown Mall and about four miles west on Route 38. The second-largest mall is Deptford Mall and third-largest is what was Echelon Mall, now called Voorhees Town Center after undergoing its own transformation. PREIT also owns the Cherry Hill Mall.
In Moorestown, Macy's closed in the first quarter of 2017 and Lord & Taylor and Sears left the mall in the first quarter of 2020, according to the township's preliminary report, which will be used to help decide whether to designate the property as an area in need of redevelopment. Boscov's lease goes to 2028, as does that of Regal Cinemas, the movie theater that still has not reopened in the current pandemic.
PREIT's "biggest challenge is determining how to repurpose space within the mall. With the ever-evolving retail environment, it is difficult to reuse obsolete buildings," the company states in the December township report, written by Planning Board planner Michelle M. Taylor, president of Taylor Design Group Inc. of Mount Laurel.Â
PREIT reported its total investment in the property is $189 million. Its return on investment the year after it bought the mall was 12.6% in 2004, according to a chart in the Taylor report. That ROI plunged to a low of 3.5% in 2013 and stood at 3.9% in 2019, the latest year on the chart.
"Many businesses are shrinking or closing altogether, reducing shopping center occupancy and rents. The notable exceptions are grocery, drug, and home improvement stores," the Taylor report states, quoting a 2020 real estate emerging trends study by the Urban Land Institute, a Washington, D.C.-based nonprofit.
"The expected returns for retail real estate are cited as poor to fair. Regional malls are noted to be the weakest retail investment below, (in ranked order) neighborhood and community shopping centers, lifestyle entertainment centers, outlet centers, power centers and urban and high street retail," the Taylor report states in its excerpt from the ULI study.
The owner of the Moorestown Mall announced it will build apartments and a hotel at the mall. This rendering shows Boscov's, right, and new construction, left.
