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Construction starts on $100 million Exeter retail strip

READING EAGLE, May 29, 2008

A developer says most tenants signed on before the economy weakened and that commerce could be healthier by the time the center opens next summer.
By Erin Negley
Reading Eagle

Set to be Exeter Township’s biggest shopping center, Exeter Commons is finally more than talk.

Construction crews are transforming 44 acres along Perkiomen Avenue at West 47th Street into 500,000 square feet of retail space.

The center, scheduled to open in July 2009, is expected to include Target, Lowe’s, Giant, Staples, Circuit City, Petco, Red Robin and several other businesses.

The $100 million project includes major road improvements that began recently on Perkiomen Avenue where it meets the West Shore Bypass, also known as Route 422.

Work crews have razed several buildings, including the Dutch Colony Inn & Suites, to clear space for the shopping center. The official groundbreaking was Wednesday.

“I think it’s going to be a big boon for our tax base,” Exeter Supervisor Michelle P. Kircher said after the event. “It’s the beginning of a new Exeter Township.”

Exeter JV Associates, a partnership of The Goldenberg Group and Ironwood Property Group, both of Montgomery County, is the developer.

Discussions began three years ago when Target approached the development companies looking to build another store in Berks County, said Jeremy Fogel, president of Ironwood Property Group.

By the time retailers started to be more cautious about the economy, most Exeter Commons tenants had signed lease agreements, he said.

“The market has absolutely pulled back,” Fogel said. “Our timing is excellent. If we hadn’t had the push from all of the people we had participating, or the project went much longer, you never know what the current environment would have dictated. The retail environment is not a good one today.”

For example, a national chain restaurant was interested in one of the two available restaurant sites but decided to pass, Fogel said, declining to identify the company.

Even so, only 12,000 square feet of the 500,000-square-foot center isn’t leased, he said.

“The fact that the economy is turning to the worse is never great, but we’re optimistic that we have a 14-to-16-month construction cycle,” Fogel said. “When we open the stores, we might be in a different economic situation.”

To pay for the $18 million in road improvements, developers used several funding options.

A tax agreement will divert most of the center’s property taxes for 20 years to pay for a portion of the roadwork.

Also, the Pennsylvania Department of Community and Economic Development awarded the project a $7.9 million grant.

Exeter Commons developers made three community donations Wednesday: $12,500 each to Exeter Community Library and the Reiffton Fire Company, and $125,000 to the township.

Exeter supervisors have not discussed how the township’s share will be spent.