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After a multi-year search, Five Below Inc. has settled on keeping its headquarters in Center City.
Joel Anderson, CEO of the retailer, told analysts Aug. 31 the company found a new home for its corporate headquarters in Philadelphia, where it has been since its founding in 2002.
Five Below Inc. opened last fall a large store on Chestnut Street in Philadelphia.
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Five Below Inc. opened last fall a large store on Chestnut Street in Philadelphia.
Natalie Kostelni
“As we continue to grow our business and add talent across all functional areas particularly the merchandising organization, we have outgrown our current space,” he said. “We will be moving in 2018 to a larger space that can better accommodate our needs as well as our expected home office head growth for many years to come. This new space not only allows us to grow for the next 10 plus years, it also affords us an opportunity to have things like a mock lab store on-site for our merchants. This is something we do not have today. It will make us even more nimble.”
Anderson, who was going over second quarter results, said it was still finalizing the lease and there’s still work to be done on that front. He expects to make a formal announcement in a couple of weeks.
The company had been looking for a new headquarters for the last two years and reportedly considered locations throughout the region including the city's suburbs.
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In 2011, the retailer decided to relocate its corporate headquarters into 1818 Market St. in Philadelphia from 1616 Walnut St. in Philadelphia. The company now occupies roughly 60,000 square feet at 1818 Market, where it has a lease agreement expiring in 2022, with options to renew for two successive five-year periods, according to documents the company filed with the Securities and Exchange Commission.
It couldn’t be confirmed where the company is zeroing in on but there are limited options in Philadelphia for a tenant at 100,000 square feet or greater. The company was reportedly looking for around 125,000 square feet. Among its options in Center City are the Dow building and Aramark Tower. Another option, 2400 Market St., is reportedly being tied up with Aramark Corp., which has also committed to keep its headquarters in Philadelphia but has launched a search for a new space.
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Formed 14 years ago, Five Below is also set to open its 500th store. The Philadelphia-based retailer, which targets pre-teens and teens with products priced at $5 or less, will open its next store on Sept. 9 in Trexlertown, Pennsylvania. Five Below (NASDAQ:FIVE) has more than doubled the number of stores it has over the last three years. It is now in 30 states and has 59 Five Belows in Pennsylvania.
It has also been working on a test store in Michigan and experimenting with a new visual design, store layout changes and enhancing its merchandise offering, Anderson said in the conference call with analysts.
“We will incorporate the learnings from this test store and reflect them in future openings,” he said. The size is about 10 percent bigger than a typical Five Below store and is brighter with some new fixtures and graphics. It anticipates rolling it out in 2017.
Natalie Kostelni covers real estate and economic development.
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