We introduce a class of partially coherent beams with spatially varying correlation properties. It is shown that mathematically simple modifications in the coherence function of conventional Gaussian Schell-model beams lead to partially coherent fields with extraordinary free-space propagation characteristics, such as locally sharpened and laterally shifted intensity maxima. We study the properties of such fields based on an elementary-mode interpretation and by numerical simulations. The results demonstrate the potential of coherence modulation for beam shaping applications.