I. Goldberg Army & Navy struggles after Center City rent hikes forced a move in favor of a Wawa
The new location at 718 Chestnut Street doesn't see as much foot traffic as the old site, and sales are suffering, third generation owner Nana Goldberg said.
An iconic local retailer, entering its 100th year of business, is struggling to let customers know where its one store is located.
Nana Goldberg, the third-generation owner of I. Goldberg, said her store had to move a year ago from the prime corner at 1300 Chestnut to make way for Wawa, the ever-expanding food, fuel, and convenience store chain that could pay far more in rent. I. Goldberg, with its military jackets, work boots, and utilitarian raincoats, is now tucked away at 718 Chestnut St., a much less visited block for retail, Goldberg said.
Sales are down, leaving Goldberg to focus on filling the shelves with more merchandise and hoping word-of-mouth is enough to attract the stream of customers she was used to seeing at her previous locations.
Despite all this, she’s determined to stay.
“Carrying on my family’s legacy is extremely important to me,” said Goldberg, 62, who has run the store since 2002 and who worked with her father, Charles, until six weeks before he died in 2009. “I. Goldberg has been a part of so many people’s lives. … People come in with their great-grandchildren.”
As Center City continues to see development beyond Rittenhouse, transforming neglected areas into retail and residential destinations, local, family-owned businesses such as I. Goldberg could be priced out.
Wawa is now paying $70 to $80 a square foot, while I. Goldberg’s rent was less than $30 a square foot for the old 1300 Chestnut site, said Larry Steinberg, Rittenhouse Realty Advisors' chief operating officer who secured the deal. PMC Property Group, which owns the building at 1300 Chestnut St., and I. Goldberg declined to share rent prices. Wawa said it could not comment.
Adriano Calvanese, PMC Property Group’s vice president, said the rent hike was “just a function of activity in the marketplace and the demand for good corner locations.”
“I. Goldberg was a tenant in the building for a very long time,” Calvanese said. “We loved the relationship that we had when we had it and that’s it.”
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Goldberg said she struggled to find a space for the store in Center City with affordable rent prices and was not able to open during the 2017 Christmas season. The store reopened on Dec. 30, 2017, and this set the business back during what should have been its most profitable time. Sales this year were about half of what I. Goldberg usually saw at the 1300 Chestnut St. location, said Tom Egolf, a business consultant for I. Goldberg.
The new location has merchandise on three floors, about 3,200 square feet each, Goldberg said. There is also a lower level that I. Goldberg is using for shipping and receiving and plans to convert to housing more surplus and clearance items, Goldberg said.
A year later, there still aren’t as many people walking by the store, Goldberg said, noting how the previous location allowed for the use of attractive window displays to lure in customers.
I. Goldberg advertised on 97.5 the Fanatic FM radio station before the holidays because most of its customers are men, and this has been its only paid advertisements so far. The store also runs a Facebook page with more than 7,750 likes.
Before Goldberg spends more on advertising and “a real sign,” she has focused on the products inside the store.
Some of the people who come in are just using the store as a showroom, Goldberg said, asking employees for advice on such items as shoes and outerwear, comparing prices on their phones, and leaving to buy the items from another website, such as Amazon.
“We compete with Amazon by being people, by being friendly, by being helpful,” Goldberg said. “It’s a whole different experience than pushing a button and waiting for a package to arrive.”
Goldberg says she hopes that the $420 million investment fueling the Fashion District, with 838,000 square feet of retail coming on Market Street between 8th and 11th Streets, will reinvigorate the area and attract shoppers to her street. Still, she thinks the city could do more to support stores such as hers, possibly through promoting small businesses throughout the year.
“What makes the city special? The Gap does not make the city special. The Apple store does not make the city special and different. The giant banks on every corner do not make the city special,” Goldberg said. “I’m not looking for charity, but it would also be nice that when the city talks about uniqueness, with all our special museums, that maybe they point out a couple unique businesses you can only find in Philadelphia."
“I think the city values how many Wawas they can have,” she said.
While the retailers in Center City continue expanding beyond Rittenhouse and national brands announce new stores in the area, the Center City District highlighted in a recent report that local businesses comprise 75 percent of the downtown tenants.
“We’re really pleased she’s staying in Center City,” Paul Levy, Center City District president and CEO, said of I. Goldberg. But, he said, “you just can’t freeze the real estate market in one place in one time. It’s going to change.”
When I. Goldberg opened its East Chestnut Street location in 2002, there were high vacancies and a facade improvement matching grant program to revitalize the area, Levy said. He hoped that I. Goldberg would be the kind of high-quality retailer that would attract people to that area.
Anyone walking around this area today can tell these blocks are no longer underperforming — and the market is responding. I. Goldberg benefited from this at first, with an abundance of windows and the benefit of pedestrians flowing into the streets after the Macy’s light show every holiday season. But then its lease expired, and it was no longer financially possible to stay.
The current site is I. Goldberg’s fourth location. Goldberg’s grandfather opened I. Goldberg about 1919 at Fourth and Market Streets in Old City as a dry goods store. He eventually added military surplus and other functional clothing, Goldberg said. I. Goldberg later moved to 902-906 Chestnut St. (now a parking garage), then 1300 Chestnut (now a Wawa), and most recently to 718 Chestnut St.
“The city is changing, but we like to think we add something different to the city by being truly Philadelphia,” Goldberg said, “an iconic part of the city that you can’t find anywhere else.”
Generations of Philadelphians have visited the stores, buying Carhartt jackets, digging through the military surplus selection, and trying on work boots. Customers have sent Goldberg holiday cards, weddings invites, and bar mitzvah dates.
Philadelphia fashion and photography blogger Reuben “Big Rube” Harley, one of I. Goldberg’s frequent customers, stopped by the new store late last month and said he’ll keep showing up regardless of how many times the address changes.
“I love it. Location really don’t matter to me. It’s like they have the great products and the welcoming service. Nan Goldberg, that’s my homie,” he said. “The people here is true and bred and they’ve been here for ages. You feel at home when you come in here.”