Marshall's plans first Center City store

The first Marshall's clothing store in Center City Philadelphia will replace the Staples at 1046 Market Street in Center City's shopping district.

Metro Commercial Real Estate broker Donna Drew sold Marshall's owner TJX Cos. of Massachusetts on the 26,000 sq.ft. site after Staples declined to renew its lease with landlord Jenel Management Corp. of New York. Staples is consolidating to its stores at 15th and Chestnut and on Delaware Ave.

Metro boss Steve Gartner called the switch "a net win for Center City" since Marshall's isn't already in the neighborhood and "everyone shops at Marshall's." The Marshall's in my neighborhood devotes a majority of its space to modestly priced women's clothing and housewares, but also features small men's clothing, book, toy and appliance departments.

"Market Street is well positioned to become one of the city’s premier retail corridors, which is why we are investing in our property and adjusting the tenant mix,” Jenel Management Corporate president Michael Hirschhorn said in a statement.

Gartner said the competing Ross store at 8th and Market and the Old Navy store in the nearby Gallery are busy, showing there's demand for more. He wouldn't comment on whether Marshall's is paying higher rent (since it gets higher sales than Staples) or lower rent (given the weak economy).

TJX, which opened a state-subsidized, 1,000-worker, 1 million-sq-ft warehouse in Northeast Philadelphia in 2001, has been expanding Marshall's, TJ Maxx and other outlets nationally as its sales rose while larger retailers have fallen through the recession.

Marshall's opened a South Philly store last year. Gartner said the Center City District-backed Philadelphia Retail Market Alliance "got in front of (Marshall's) with a lot of good stats" to prod them into considering Market East. The site, once home to a Woolworth's and a W.T. Grant discount store, was split between Staples and a CVS pharmacy, which remains.

"We met with Marshall's a couple of years ago at the International Council of Shopping Centers (in Las Vegas, May 2010) and then we met with Jenel and told them all the great things that were happening," Michelle Shannon, alliance co-chair, told me. Around Christmas 2010, Jenel President Michael Hirschorn and broker Michael Katz visited their Philadelphia properties so the boss could check out firsthand Center City's recent residential, hotel and restaurant expansion.

Hirschorn "was like, 'Wow,'" Shannon said. "They own lots of different properties, and we were able to get him to see that maybe there were higher, better uses. Nothing's wrong with Staples. But people love Marshall's, whether you're a high-end shopper, or a bargain shopper. Ross has done well here, Daffy's has done well here." No worries about stripping existing stores to feed new ones? "No! There's enough business to go around. And I hope they include home goods - we don't have nearly enough in Center City for all the residents." Hirschorn and Katz didn't respond to messages.

The neighborhood is part of Center City's new "Commercial Advertising District," in which the Gallery's owner, Ron Rubin's Pennsylvania Real Estate Investment Trust (PREIT), and other landlords hope to add Times Square-style light-up billboards to attract night shoppers and tourists.

PREIT is refocusing some of its malls, like the Moorestown Mall, away from old-style full-service chain department stores toward restaurants and bars. Center City District says it's spent $6 million on better Septa shelters and landscaping for the Market Street strip. The district is  also overseeing the state-subsidized $55 million renovation of Dilworth Plaza, which splits Market Street just west of City Hall.