Improved tenant mix and physical enhancements drive improved results
Philadelphia, PA, September 4, 2019 – PREIT (NYSE: PEI) Following a multi-year remerchandising effort, PREIT’s Mall at Prince George’s (“MPG”) emerges as a marker of success in the Company’s redevelopment efforts.
Located just outside of Washington DC, the property is perfectly situated to benefit from growth in the region, along the Metro line and approximately 15 miles from Amazon HQ2 in Crystal City. In densely populated Hyattsville, MD, MPG is surrounded by a growing trade area where household incomes exceed the US average by over 15 percent. Nearly $1 billion has been invested in the region over the past several years on high quality housing and office development, underscoring the immense potential for a growing shopper community. With strong demographics and high demand for retail, the renovations will ultimately further differentiate MPG in the market and solidify its position as a vibrant retail and dining destination in the region.
Over the remerchandising period, notable improvements in operating metrics include:
- Over a dozen new tenants joined the roster including H&M, Ulta, DSW, Express Factory Outlet, Five Below, Flight 23, Grand Jewelers featuring Alex and Ani and Pandora, White Barn Candle and Pink by Victoria’s Secret along with several new dining options: Chipotle, Five Guys, Mezeh Mediterranean Grill and &Pizza.
- Sales have increased over $100 per square foot or 23% since December 2016 to $557 per square foot, outpacing our portfolio growth rate of 15% over the same period.
- Traffic has improved over 20% for the rolling 12 month period ended 7/31/19 compared to the prior 12 month period.
- NOI has also grown by over 20% since the beginning of the redevelopment and occupancy has been steady at 98%.
Looking forward, changes on the horizon include additional new-to-market dining options: Hook & Reel and Miller’s Ale House.
“The work we have done in creating value at Mall at Prince George’s is indicative of the anticipated results throughout PREIT’s portfolio,” said Joseph F. Coradino, CEO of PREIT. “Curating diverse offerings across multiple categories is key to success as this business evolves. Having moved quickly to replace department stores and repositioning our portfolio of well-located assets in dense, growing markets, PREIT is well-positioned to increase value to our shoppers, tenants and shareholders as our redevelopments are completed.”
PREIT (NYSE:PEI) is a publicly traded real estate investment trust that owns and manages quality properties in compelling markets. PREIT’s robust portfolio of carefully curated retail and lifestyle offerings mixed with destination dining and entertainment experiences are located primarily in the densely populated eastern U.S. with concentrations in the mid-Atlantic’s top MSAs. Since 2012, the company has driven a transformation guided by an emphasis on portfolio quality and balance sheet strength driven by disciplined capital expenditures. Additional information is available at www.preit.com or on Twitter or LinkedIn.
Forward Looking Statements
This press release contains certain forward-looking statements that can be identified by the use of words such as “anticipate,” “believe,” “estimate,” “expect,” “project,” “intend,” “may” or similar expressions. Forward-looking statements relate to expectations, beliefs, projections, future plans, strategies, anticipated events, trends and other matters that are not historical facts. These forward-looking statements reflect our current views about future events, achievements or results and are subject to risks, uncertainties and changes in circumstances that might cause future events, achievements or results to differ materially from those expressed or implied by the forward-looking statements. In particular, our business might be materially and adversely affected by changes in the retail and real estate industries, including consolidation and store closings, particularly among anchor tenants; current economic conditions and the corresponding effects on tenant business performance, prospects, solvency and leasing decisions; our inability to collect rent due to the bankruptcy or insolvency of tenants or otherwise; our ability to maintain and increase property occupancy, sales and rental rates; increases in operating costs that cannot be passed on to tenants; the effects of online shopping and other uses of technology on our retail tenants; risks related to our development and redevelopment activities, including delays, cost overruns and our inability to reach projected occupancy or rental rates; acts of violence at malls, including our properties, or at other similar spaces, and the potential effect on traffic and sales; our ability to sell properties that we seek to dispose of or our ability to obtain prices we seek; our substantial debt and the liquidation preference of our preferred shares and our high leverage ratio; our ability to refinance our existing indebtedness when it matures, on favorable terms or at all; our ability to raise capital, including through sales of properties or interests in properties and through the issuance of equity or equity-related securities if market conditions are favorable; and potential dilution from any capital raising transactions or other equity issuances. Additional factors that might cause future events, achievements or results to differ materially from those expressed or implied by our forward-looking statements include those discussed herein and in our Annual Report on Form 10-K for the year ended December 31, 2018 in the section entitled “Item 1A. Risk Factors.” We do not intend to update or revise any forward-looking statements to reflect new information, future events or otherwise.