We delight in seeing our clients’ projects in the news. From new retail stores and pick-up locations, to townhome and mixed-use projects, to multi-channel logistics and distribution, our clients remain dynamic players in the market across dozens of cities and states. Our clients are, of course, not the only companies doing great work. This is the first in a series of posts where we take time to appreciate the work others are doing in our own backyard, and share our outlook on the local commercial real estate market.
North Station District
The announcement of large-scale development at the intersection of North Broad Street and Indiana Avenue in North Philadelphia came as a surprise to many. A New York developer has proposed a 21-story tower with 128 apartments and offices, a 6-story apartment building with 105 units, and renovation of a 180,000 sq. ft. industrial building. Although dis-invested for many years, this location boasts a subway stop, a regional rail stop, and an Amtrak stop—a combination matched by only 30th Street Station in Philadelphia, Union Station in Washington, D.C., Penn Station in New York, and Back Bay Station in Boston. Temple University is less than a mile to the south, and Temple University Hospital is a few blocks north.
The issue underlying this development—or rather, all real estate development—is funding. Will this proposed construction happen only with public assistance like a grant from the Commonwealth of Pennsylvania’s Redevelopment Assistance Capital Program (RACP)? Only time will tell.
Delaware River Waterfront
The Durst Organization of New York has purchased 4.3 acres of property located on four piers (12, 13-15, 19 and 24). Although The Durst Organization publically stated that it has no short-term plans for development, it is exciting to see developers realizing the potential in the Delaware River Waterfront. As many neighborhoods and areas of the City have boomed with development, the Delaware River Waterfront has progressed slowly but steadily. Master planning and redesign efforts continue, and, if renderings of new public spaces hold true, private development surely cannot be far away.
A zoning overlay called the Central Delaware Riverfront Overlay District creates a minimum height of 25 feet and a maximum height of 100 feet for any new buildings. The height limitation can be increased via certain bonuses like planning for a green building certification, including mixed-income housing, and creating public spaces. It will be interesting to see how these parameters affect the Durst Organization’s proposals.
The area west of the Schuylkill River has enjoyed recent success with the completion of FMC Tower and EVO (Cira Centre South). Now, the City, Brandywine Realty Trust, and Drexel University are planning a long-term redevelopment of the area around 30th Street Station, including construction on top of the existing railyard. The Schuylkill Yards development will take decades to fully realize; renovation of existing buildings is already imminent and new construction should soon follow.
Covering railyards with buildings and public spaces creates interesting legal issues. Various public, private, and quasi-public players must negotiate hefty documents to allow for easements for the air space to build buildings while ensuring safe construction and maintenance of the rail yard.
- New Yorkers seem to be looking deeper into Philadelphia for investment opportunities. We wonder which force is stronger: the “push” (i.e. lower returns to be had in New York) or the “pull” (attractive opportunities in Philadelphia)?
- Announcement of public development along the Delaware waterfront may be catalyst for private development.
- Proximity to intercity transit is a unique asset, and several areas of Philadelphia hold untapped potential to lure talent from up and down the Northeast Corridor.