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PhillyDeals: PhillyDeals: A casino, not a retailer, as Gallery anchor?

Pennsylvania Real Estate Investment Trust (PREIT) tore out walls and lured new stores to its shopping malls in Plymouth Meeting, Willow Grove, Cherry Hill, Moorestown and Voorhees last spring. But it wouldn't tell its plans for the Gallery in Center City.

RON SOLIMAN / The (Wilmington) News Journal State Treasurer Jack Markell waves to supporters before making his victory speech. On Tuesday, he won the most expensive gubernatorial primary in Delaware's history, beating Lt. Gov. John Carney. Markell, a Democrat, will face retired judge Bill Lee, who clinched the Republican primary.
RON SOLIMAN / The (Wilmington) News Journal State Treasurer Jack Markell waves to supporters before making his victory speech. On Tuesday, he won the most expensive gubernatorial primary in Delaware's history, beating Lt. Gov. John Carney. Markell, a Democrat, will face retired judge Bill Lee, who clinched the Republican primary.Read moreRON SOLIMAN / The (Wilmington) News Journal
    by By Joseph N. DiStefano, Inquirer Staff Writer | Columnist
    Published 

Pennsylvania Real Estate Investment Trust

(PREIT) tore out walls and lured new stores to its shopping malls in Plymouth Meeting, Willow Grove, Cherry Hill, Moorestown and Voorhees last spring. But it wouldn't tell its plans for the Gallery in Center City.

That changed yesterday, when

Foxwoods Development Co. L.L.C.

tapped the Gallery as a possible substitute for its South Philly gambling-hall proposal, which neighbors didn't like. PREIT chairman

Ron Rubin

is a Foxwoods investor.

"This is a relatively new development," said PREIT president

Joseph F. Coradino

. "We were working on another plan for the Gallery. It wasn't this plan, it was a redevelopment of the Gallery not inconsistent with the kinds of things we've done in the suburbs."

Why a casino? "It's an anchor," Coradino said.

It brings traffic. Potential shoppers. "Everything you do in a shopping center is around driving traffic and sales. There's not many of the old department stores left in Center City." A casino's a good substitute, he figures.

In Cherry Hill, PREIT is replacing stores popular with Camden shoppers with upscale shops geared to its wealthy suburban neighbors.

That's not the plan at the Gallery, Coradino said. PREIT doesn't want "to distract from its customer base," but to add "a new customer that would be drawn to the property when you include casino and you begin to introduce restaurants."

There ought to be more of a mix of traffic on Market East, given who lives and visits nearby, Coradino said. "You've got the new Center City residents. You've got the transit, the person coming from the burbs, the visitor to Independence Hall. You've got the conventioneer. And you've got the shopper who's there now," who probably took a bus or El from a neighborhood outside Center City.

"The challenge is to incorporate a retail, restaurant, entertainment and casino mix that has something for all those folks," he added.

"Step one is simple. Let's incorporate restaurants. We have to stop people walking out of the Convention Center and saying 'Get me a cab.' We have to introduce some restaurants that serve the conventioneer.

"More difficult is to create a compelling retail environment. I'm optimistic. Once you get the traffic, suddenly you'll have the answer to the question of what will the mix will be."

More for power

Exelon Corp.'s

electric subsidiary

Peco Energy Co.

asked for new price-setting powers yesterday from the Pennsylvania Public Utility Commission.

The power company's not asking for a set price. It's asking to be able to base prices on future power costs.

That means a 20 percent rate hike by 2011, if fuel costs and other expenses stay at today's levels, said spokeswoman Cathy Engel. Maybe more. Or less.

Ellis eyes Pa. funds

Montgomery County has more residents than Alaska. Does that mean ex-Montco commission chairman

Tom Ellis

is as qualified as Alaska Gov. Sarah Palin, a fellow Republican, to run for vice president?

Ellis, in his law office at

Ballard, Spahr, Andrews & Ingersoll L.L.P.

in Center City, laughed and shook his head as he prepared for a McCain-Palin rally in Lancaster.

He's running for state treasurer against Democratic venture capitalist

Rob McCord.

Ellis said his experience as a municipal finance lawyer was more relevant than McCord's record of investing state dollars during the Internet bubble and collapse, and taking donations from state investment contractors. (McCord said he would recuse himself to avoid conflicts.)

Ellis said he was uneasy about the Pennsylvania Treasury's growing reliance on private-equity, hedge fund and real estate investments that aren't subject to public scrutiny.

"The fees these firms charge are extraordinarily high, but . . . you don't know where the money is invested, and you don't know if you're going to make a profit for years and years. That should change."

The $33 billion

Pennsylvania State Employees' Retirement System

(SERS) says it lost almost 3 percent of its value in the first half of the year, despite the carefully hedged diversity of its $35 billion portfolio. Others did worse, SERS noted.

Contact staff writer Joseph N. DiStefano at 215-854-5194 or jdistefano@ phillynews.com.