Simon Property Group, the Indianapolis-based retail giant that owns 200-plus shopping malls nationwide, is sacrificing more than 400 parking spaces at its King of Prussia Plaza and Court to make room for at least 50 new stores and restaurants that it hopes will draw more wealthy shoppers to the region's biggest retail complex.
At extra-large shopping centers such as King of Prussia, at least, "the mall business is good, contrary to some of the naysayers," David Contis, president of Simon Malls and a corporate senior vice president, told me Monday.
His company bought out other investors to take control of the King of Prussia mall in 2011, in deals that valued the complex at over $1 billion.
Contis said he expected to attract luxury stores from outside the region and "the best of the Philadelphia eateries" to the new space, rather than shifting current tenants there.
General contractor IMC Construction Inc., of Malvern, began work this year to prepare for tearing down the parking deck next to Neiman Marcus and adding 155,000 square feet of new stores and restaurants.
Besides the new enclosed area, which will connect the existing Neiman Marcus, Macy's, and Bloomingdale's department stores, Simon plans a replacement parking deck with valet-parking areas, digital sensors that will post the number of vacant spaces available, and ramps the company says are designed to speed traffic in and out, among other amenities.
The project will reduce total parking spaces at the center to 12,728 from 13,199, the company said.
"We spent two years figuring this out. That's lightning speed in this business," Contis said.
Upper Merion Township says the King of Prussia complex attracts about 25,000 shoppers a day, ballooning to 125,000 at the height of the holiday shopping season.
Mall stores employ about 6,000, compared with 17,000 at the nearby King of Prussia Industrial Park, which includes offices for Lockheed Martin, GlaxoSmithKline, eBay, and other big companies.
Contis wouldn't say how much Simon intends to spend on the King of Prussia mall expansion.
The company says this is one of 31 U.S. mall-improvement projects to which it has committed a total of $1.7 billion this year. Simon also owns the newly renamed Philadelphia Mills complex in Northeast Philadelphia, the new Gloucester Premium Outlets in South Jersey, and Montgomery Mall, where Simon recently replaced an empty department store with a Wegmans grocery, among others.
In a conference call with investors last month, David Simon, Simon Property Group's chairman and chief executive, said his company had needed agreement from Sears before finalizing its King of Prussia expansion plans.
Sears last month announced the closing of its King of Prussia store, which it has leased to Dick's Sporting Goods and the Ireland-based Primark department-store chain.
Primark is "certainly not a luxury store," but will bring new traffic to its end of the mall, Simon told the investors.