KING OF PRUSSIA, Pa. (CBS) -- It is already one of the biggest malls in the country, but now the King of Prussia Mall in Montgomery County is about to get even bigger, something that could have ramifications for the retail sector around the country.
Simon Property Group, the mall's owner, announced on Tuesday that King of Prussia will undergo its largest expansion in 15 years. The mall will add a 140,000 square foot wing, finally connecting the Plaza and the Court. Combined with 10 new shops under construction where the John Wanamaker and Strawbridge's department stores once stood, the mall will add 50 new stores and several restaurants.
"Amazing, and if it's all connected, incredible," said Shari Hoffman of Lafayette Hill, Pa. "I have no idea what else they're going to put in. What stores don't we have?"
"For the last five years or so, the American shopper has been trying to get his or her balance sheet in order, so there's lot of pent up demand and pent up energy," said Villanova University economics professor Peter Zaleski who believes this expansion is coming at the perfect time, even though the economy has not fully recovered.
"If you build it before the recovery, it's in place when the recovery comes," he said.
Given King of Prussia's prominence in retailing, this project – a significant commitment – could also be a turning point for the rest of the retail sector.
"Part of what has kept the U.S. economy in this recession is the uncertainty, so just the fact that there's someone out there saying I'm bullish on the U.S. consumer makes a big statement," Zaleski said. "What the mall owners are saying is sometime in the next four years by the time this thing is ready for a grand opening, we think the economy is going to be fully recovered."
The new wing will be built adjacent to Neiman Marcus and Macy's, over Mall Boulevard, north of the existing open-air crosswalk between the Plaza and the Court (see graphic).
Connecting the two structures is something Upper Merion Township planners have advocated for years, since the Plaza was significantly expanded in the mid-1990s. Officials hope it cuts down on the number of shoppers who choose to drive between the Plaza and Court.
"Now they could park once and shop at both facilities, and that could help reduce traffic congestion," said Ron Wagenmann, the Upper Merion Township Manager. He expects the permitting process for the construction to take about three to four months.
In its announcement, Simon Property did not provide a price for the construction project, nor would officials estimate the number of construction and permanent jobs. No official construction timeline has been set, but it's estimated to run three to four years. The new stores on the Wanamaker's site are expected to be open in time for the 2012 holiday shopping season.
Simon has not announced those tenants, but a company spokesman said the interest in leasing for those 10 slots was a factor in launching this expansion.
King of Prussia has weathered the economic recession well, compared with most malls and shopping centers. It is consistently above 90 percent occupied, and Simon says it is one of its best-performing properties, placing its annual sales per square foot above $517. That means yearly sales at King of Prussia alone are at least $1.3 billion.
Reported by Ben Simmoneau, CBS 3
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