5Qs for Heather Crowell on reimagining the mall
Seven years before COVID-19 stalked open society and changed the game for owner-operators of shopping centers, CEO Joe Coradino began disposing of under-performing malls in PREIT’s portfolio and replacing traditional anchors with restaurant plazas and entertainment purveyors. By his side throughout this early reimagining of the enclosed shopping space was Heather Crowell, now executive VP of strategy and communications at the Philadelphia-based company. We spoke with Heather to learn how the pandemic might have altered the path PREIT was already on.
Heather, back in the early Teens, what urged PREIT to undertake a wholesale reassessment of its malls?
When Joe became CEO, we took a step back and took a long look at the portfolio. We talked about the future of the business and asked, “Where do we want to go?” The conclusion we came to was that was that, even then, there was too much retail in this country, so we did demographic and psychographic analyses of all the markets we were in and embarked on the program to sell properties that didn’t fit our new game plan. Starting in 2013, we were successful in selling 18 properties.”
Did the pandemic have any significant effect on your ongoing business plan?
The biggest thing that was accelerated was defining how to optimize our real estate—what was essential, what was non-essential, and how do you carve that up. Before the pandemic hit, we were already adding multifamily housing and grocers. We had already determined that we had been isolated in this box defined as a mall and we began transforming our properties into mini villages. What the pandemic made clear to us was how critical a piece of the local ecosystem the mall was. We’re community hubs, and not limited to shopping.
We’ve noticed that PREIT’s major mall renovations have varied greatly market-to-market.
We began getting more into a mindset that we didn’t own malls, we owned real estate. We have one location that already had hundreds of housing units built around the property and concluded that a self-storage facility was a great use for the under-utilized, below-grade space. There’s a need for more multifamily housing in Moorestown in suburban Philadelphia, so we are reinventing our property there. There’s going to be a Cooper University Health Care outpatient facility there, a hotel, and apartments.
PREIT’s retail real estate only, so what’s your game plan for adding residential?
Our intention is to sell the land to residential developers, but to enter into agreements with them to connect with us and create cross-trafficking between the properties. For instance, we could give apartment residents special discount codes and create events for them that extend beyond the walls of the complex. The other thing is to ensure that the residential site will be a short and safe walk to the retail site and not be on the other side of the road.
Most developers we’ve spoken with say that close proximity to shopping, dining, and personal services is something greatly desired by today’s consumers. Are you experiencing that same desire?
If you think about the people who moved out of New York City or Boston during the pandemic, they’re used to being able to get whatever they need within three blocks of where they live. But is somebody going to go grocery shopping at one of our properties and then go buy some jeans? Our goal is to become the one-stop-shop that alters the customer’s behavior, creating new patterns for new customers. We want to have them thinking they can come to one location for all their needs.