A Conceptual Pivot As Gallery Renovation Proceeds

Market East was a commercial center in Philadelphia in the early part of the 20th century, but as the decades rolled along, increased competition from the suburbs and other factors resulted in a diminished status for this shopping district. The Gallery opened its doors in 1977, in an effort to beat back this phenomenon, creating a suburban shopping experience in an urban setting. And people were really into it! The first phase of the mall had Strawbridge’s at its eastern end and a relocated Gimbels to the west with stores in between, and for for a time the mall was a major attraction. It was successful enough that a second phase was constructed in the mid-1980s, stretching the mall to 11th Street and connecting it to the (then newly opened) Market East Septa Station.

But if you’ve lived here for any length of time, you know how things went. It wasn’t too long after the Gallery II opened that the mall started falling on hard times. According to a story on deadmalls.com, Gimbels closed in the late 1980s and mall patrons couldn’t get from Gallery I to Gallery II on the upper floors. Clover eventually opened in the former Gimbels, but only on the first two floors, which resulted in snowballing vacancies on the 3rd floor of the mall. As the years went on, the Clover became a K-Mart, the JC Penney at 11th Street became a Burlington Coat Factory, the Strawbridges closed, and the mall took on a lower budget vibe. Combined with the fact that the building had absolutely no street presence, the Gallery has been long overdue for a major renovation effort.

And that’s just what’s happening now. A couple years back, we told you about plans from PREIT and Macerich to spend a couple hundred million dollars to renovate the property into the Fashion Outlets of Philadelphia. We didn’t have too many details at that time, as no leases had been signed, but we did find out that the City was pitching in a bunch of money, ditto the state, to make the project happen. Back then, the developers were still lining up their approvals, but as we mentioned somewhat recently, construction has been full steam ahead for quite some time already.

At 9th & Market
View on Filbert Street
A peek at the construction, already in progress

Yesterday, a story on Philly.com shared the news that the owners of this property are having a change of heart with the concept and are abandoning plans to have outlets here. Instead, they’ll be calling the mall by the name Fashion District Philadelphia, and seemingly targeting higher end retail tenants than the outlets originally proposed. The only lease officially announced in the article is with H&M, which will sport a 38K sqft space, much larger than their other locations in town. In addition, the mall will have a movie theater (!) with reclining chairs and food and booze, a first for this concept in downtown Philadelphia. On Filbert Street, the developers have retained Vibrant Development Group to create a “dining and entertainment” district. This certainly sounds better than the blank wall that was here before.

Old rendering, image from Philly.com

The sign on the front of the project indicates that the mall will be opening in 2018, so it won’t be long until we can see Fashion District Philadelphia with our own eyes. With hundreds of thousands of square feet seemingly yet to be leased, we should be getting several big announcements about the stores coming to the mall over the next several months, as those leases get signed. As this project approaches its conclusion, the East Market project across the street should find itself in a similar state, combining with the mall to crease a dramatically revived commercial district in Market East. It may have taken many decades, but this neighborhood is finally making a comeback, and in a big way.