The landscape of the supermarket business in Philadelphia is changing at a dramatic rate. Larger store formats, such as Wegmans, Target and Walmart are having serious impact on smaller supermarket chains. Two other very tough competitors, Giant of Carlisle, Pennsylvania, and ShopRite, are also reshaping the market share of food dollars spent in the Philadelphia area.
Recently Safeway purchased the Genuardi’s chain and sold off almost all the stores. Super Fresh and Pathmark closed many formerly high-producing stores with this new wave of competition. ACME Market, the former market share leader, has seen comp sales decrease dramatically. The newest entry to the market, Bottom Dollar, a discount grocer, hit Philadelphia with an onslaught of 20 new stores and is still growing.
Divaris Development’s Village at Valley Forge, in Valley Forge, Pennsylvania, is one of the newer developments that has been on the boards for a while. The Wegmans there is getting ready to open, although additional retail has not been built at this time. Not far away, in Malvern, Uptown Worthington Center by O’Neill Properties is on track leasing a new lifestyle center, going after quality tenants to take advantage of the strong demographics of the Main Line and Chester County areas.
In northeast Philadelphia, the Shopping Center at the Arsenal is one of the few new projects being planned. Arsenal Associates is developing the 500,000-square-foot power center that will dominate the entire lower northeast section of the city.
The Metro Development Center on Route 611 in Warrington (Bucks County) will feature a Walmart and regional restaurants.
North of Philadelphia, the Lehigh Valley has become a strong standard metropolitan statistical area with nearly 1 million people. In Trexlertown, just west of Allentown, Goldenberg Group and Tim Harrison created a joint venture to develop a new power center with a discount department store, wholesale club and food market.
In Southern New Jersey, the rapidly growing Gloucester County area has Richwood Marketplace, a Madison Marquette development at Route 322 and 55 in Harrison Township, with Walmart and other boxes. At Route 322 and the New Jersey Turnpike in Woolwich Township, another large power center with Walmart is being developed by Wolfson Properties. In Burlington County, an 800,000-square-foot center near Burlington Mall is in the planning stages.
PREIT, one of the Philadelphia area’s largest owners, has done an amazing transformation of the former Echelon Mall by tearing down part of the mall and building a lifestyle center, the Voorhees Town Center.
Costco, the third largest retailer in the country, continues to gain market share and recently opened new stores on Route 422 in Sanatoga (Montgomery County) and Warminster (Bucks County) and the company is under construction in Concordville (Delaware County), Pennsylvania.
Recently Kohl’s has become very active opening stores on Route 1 in Upper Darby, and in submarkets of Stroudsburg, Hazleton and Pottsville.
Center City Philadelphia has experienced major residential growth with new construction as well as conversions of former office space. There are numerous retail projects and an incredible restaurant renaissance following this growth. In southern New Jersey, the new state-of-the-art Virtua Hospital is a catalyst for the same type of retail, residential and restaurant growth.
— James DePetris is CEO of Legend Properties, Inc./TCN Worldwide