Office Sector News
$12M Renovation Project Launching At Centre Square
The owners of Centre Square have launched an estimated $12 million renovation to the building’s plaza, retail and lobby areas. BLT Architects designed the renovations for the 1.8-million-square-foot building at 15th and Market streets that will modernize and brighten the lobby and concourse; create 19,000 square feet of new retail space from a former ground-level bank branch; and add exterior lighting, landscaping and a glass wall that will create a sweeping view of Dilworth Park.
The overhaul also will return a Jean Dubuffet sculpture, currently located on the exterior of the building along Market Street, to its original location on the concourse. Nightingale Properties and Wafra Capital Partners own the two-building complex, which is punctuated by Claes Oldenburg’s Clothespin sculpture near the front entrance. The renovations will be completed by November.
OceanFirst Picks Two Logan Square For Its First Philadelphia Location
OceanFirst Financial Corp. has signed a lease at Two Logan Square to open its first physical location in Center City later this year. The bank has secured about 3,000 square feet on the 8th floor at Two Logan, enough to accommodate about 10 lenders.
The Toms River, N.J.-based bank is finalizing its candidate pool for the hiring of a Philadelphia regional president who will be responsible for commercial lending and any future retail operations in southeastern Pennsylvania. An announcement is expected in early summer. The space is scheduled to be available sometime in August.
Eds & Meds News
Gene Editing Startup Backed By Google Ventures Raises $58M
Verve Therapeutics, a gene editing startup with research labs at University City’s Pennovation Center, has raised $58 million in series A financing led by Google Ventures (GV). Other investors were Arch Venture Partners, F-Prime Capital and Biomatics Capital.
Among Verve’s co-founders is Dr. Kiran Musunuru, an associate professor of cardiovascular medicine and genetics at the Perelman School of Medicine at the University of Pennsylvania. Verve is working to commercially develop gene editing therapies that could offer lifelong protection for adults at risk of coronary artery disease.
Jefferson, Wills Eye To Create Eye-Brain Research Center
Thomas Jefferson University and Wills Eye Hospital are partnering on a new research center. The Annesley EyeBrain Center will focus on the connection between the eye — specifically the retina and optic nerve — and the brain in an effort to develop new ways to diagnose and treat neurological diseases including stroke, Alzheimer’s disease, Parkinson’s disease, multiple sclerosis, and dementia.
The center will be housed within Jefferson’s Vickie and Jack Farber Institute for Neuroscience. Officials said the first-of-its-kind institution will seek to revolutionize ophthalmic and neurological care and establish a "new frontier" in neuro-ophthalmology.
Jefferson Launches Fund For Hemp Innovation And Sustainability
A $2 million gift from Australian philanthropist Barry Lambert will spur a new Jefferson Health initiative to promote innovation in the use of industrial hemp. The cannabis crop is on the cusp of a resurgence in the U.S. as federal restrictions have eased in recent years, paving the way for commercial cultivation for various industries.
The new fund will form part of the health system's Innovation Pillar, which aims to foster entrepreneurship rooted in sustainability and medical advancement. The state is working to ramp up commercial licensing for hemp cultivation in anticipation that it will serve in the development of products ranging from textiles and clothing to food and biofuels.
Arts, Culture & Hospitality News
Walnut Street Theatre Announces $39M Expansion Project
The Walnut Street Theatre is launching a $39 million expansion project on the 800 block of Walnut Street to add a 400-seat theater-in-the-round, a fully renovated lobby and box office, a restaurant open to the public and the first dedicated education space in the 200-plus-year-old theater’s history.
The theater has announced a capital campaign for the 36,000-square-foot project, which would also convert former rehearsal halls into three classrooms, its first-ever dedicated education spaces. Groundbreaking is slated for spring 2020, and the project is expected to be completed in 2022.
1801 Vine Hotel To Be Run By Operator Of NYC’s Standard Hotel
The operator of the Standard Hotel, which straddles New York’s High Line, has a deal to run the historic Family Court building after its conversion into a luxury hotel. Journal Hotels, which also owns the Mondrian Park Avenue hotel in New York and the Hollywood Roosevelt hotel in Los Angeles, has been contracted by developer Peebles Corp. to operate its planned hotel at 1801 Vine Street.
Redevelopment work could begin as soon as late June on the 203-guest-room hotel in the 78-year-old Beaux Arts building. Coral Gables, Fla.-based Peebles Corp. was awarded the project in 2014 after a competitive bidding process.
Suraya Team Plans 3 Projects For Upcoming Center City Hotel
The team behind Fishtown's Suraya is working on three dining projects for Center City's upcoming micro-hotel. Nick Kennedy, Greg Root and Al Lucas of Defined Hospitality are now working on two restaurants and a café set to open in September at the Pod Philly Hotel on Ludlow Street between 18th and 19th streets.
Defined Hospitality is hiring management team members for front of the house and key chef positions for the kitchen. Upwards of 125 new jobs will be created by late summer. They are part of the upcoming, 11-story Pod Philly Hotel by Modus Hotels, which broke ground in April 2018. Defined Hospitality will run the restaurants and café.
Penn Medicine, Drexel To Pilot Arts And Cultural Grant Program
Penn Medicine and Drexel University have launched a program to provide funding for the city's arts and cultural organizations, which often face severe budgetary constraints despite their collective $4.1 billion impact on Greater Philadelphia's local economy.
The two organizations said the Philadelphia Cultural Pass pilot grant program will financially support the city's arts sector, increase access to cultural organizations, while engaging and nurturing a community of arts supporters. Initial partners include the Philadelphia Museum of Art, the Philadelphia Orchestra and the Kimmel Center for the Performing Arts. Penn Medicine and Drexel will both provide grants to participating cultural institutions for general financial support.
Appeal Of Anti-Toll Lawsuit Keeps SEPTA Improvements On Hold
Thirty-seven SEPTA improvement projects, including trolley modernization and the renovation of the City Hall concourse, remain on hold following the appeal of a federal lawsuit that has threatened hundreds of millions of dollar in annual transit funding.
The suit filed by a truckers’ association in March 2018 alleged that Pennsylvania Turnpike tolls inhibited interstate commerce, and it challenged the use of toll money — about $450 million a year — to fund public transportation. A federal judge dismissed the lawsuit but the plaintiff has filed an appeal, putting all projects on hold other than critical infrastructure improvements.
Philadelphia Is Suing Uber Over Allegation Of Unpaid Taxes
Philadelphia is suing Uber to get the company to open its books in a bid to recoup two years of taxes it alleges that the ride-share giant owes. The suit filed in Common Pleas Court seeks to audit Uber Technologies Inc. to determine whether the San Francisco-based company owes the city business income, receipts, and wage taxes from 2015 to 2017.
Uber operated in Philadelphia without authorization during some of that time, as ride sharing was not legalized in the city until November 2016. The lawsuit alleges that Uber has ignored multiple requests for financial data from the Department of Revenue starting in August 2018, and asks a judge to order Uber to provide the financial data within 30 days.
Legislation Would Allow New 'Park Anywhere' Car-Sharing Service
A new mode of car sharing may be coming to in Philadelphia. A bill introduced by Councilman Mark Squilla and Council President Darrell Clarke would authorize “flexible-park auto sharing organizations” to operate in the city and make per-vehicle payments to the Philadelphia Parking Authority to cover the cost of parking its vehicles in public lanes.
The bill would allow Share Now, operated by German automaker Daimler AG, to roll out as many as 500 vehicles in Philadelphia. Unlike ride-share companies that require drivers to return cars to a designated spot, Share Now allows drivers to leave vehicles at any legal on-street parking space within a given jurisdiction.
City To Add 400 More Electric Indego Bikes
City officials have announced plans to expand an electric bike share pilot program, bringing 400 more electric bicycles to city streets. The city-run bike share, Indego, will start rolling out the bikes later this month, along with 12 new Indego stations.
In November, the city placed 10 e-bikes at various Indego stations around the city and monitored their usage over the course of two months. The popularity of the bikes led officials to add them to the city’s Indego fleet.
Electric Scooter Company Bringing Test Rides To City Hall
San Francisco-based company Lime is bringing its new electric motorized scooters to City Hall for test rides at the end of May. Meanwhile, state lawmakers are still debating whether the e-scooters should be legal on Pennsylvania’s streets and sidewalks.
State Reps. Stephen Kinsey (D-201st) and Greg Rothman (R-87th) have co-sponsored a House bill in February aimed at changing the scooters’ legal status in the state. The bill was referred to the Committee on Transportation but its current status is unclear.
Residential Market News
City Announces Assistance Program For First-Time Homebuyers
A new program from the City of Philadelphia will offer financial assistance to qualifying first-time homebuyers. The Division of Housing & Community Development (DHCD) will formally launch the Philly First Home program in June, providing funds for qualified participants to use toward a down payment or closing costs.
Under the program, Philadelphia will provide assistance up to $10,000 or 6% of the home's purchase price – whichever is less. To qualify, applicants must be a first-time homebuyer or a buyer who has not owned a home for at least three years, a Philadelphia resident for at least three years, and have a household income at or below 120% Area Median Income (AMI).
9-Story Tower With 52 Units Coming To 12th & Chestnut
A 112-foot residential tower with 52 units is coming to 1208 Chestnut Street. Construction permits issued by the Department of Licenses & Inspections outline plans by developer Michael Alhadad to demolish the three-story commercial building. He purchased the property in 2017 for $2.7 million.
The planned nine-story building, located one block from the burgeoning Market East corridor, will replace a vacant storefront last occupied by the Rainbow Apparel clothing store. Renderings depict a slim high-rise that stretches a full block, from Chestnut Street to a three-story bump-out facing Sansom Street. The proposal calls for no on-site parking; the developer instead plans to lease 18 spaces from a nearby garage.
Society Hill’s Dilworth House Condo Tower Wins Final City Approval
The city’s Art Commission has unanimously approved a proposed 12-story condominium development behind the Dilworth House on Washington Square. The plans call for preservation of the front of the property, the former home of Richardson Dilworth, who served as Philadelphia mayor from 1956 to 1962.
The facade of the new construction to the rear of the property will be comprised of zinc panels and the historic house will be incorporated into the bottom floors of the tower as both common space and as part of one of the housing units. The living room on the first floor, with its fireplace and decorative molding, will remain intact for use as the “club room” of the residences. The second floor of the Dilworth House will be incorporated into one of the residential units. The tower’s upper floors will contain 10 condo units in total.
Mixed-Use Building In Center City Sells For $5.7M
Rittenhouse Realty Advisors has announced the sale of 802 Sansom Street, a mixed-use property that contains 12 newly renovated apartments and four street-level commercial/retail spaces. The property was purchased by an international buyer, said Ken Wellar, Managing Partner at RRA.
Adaptive Reuse Project Completed At 1600 Callowhill
A mixed-use development is now open in a former warehouse that most recently hosted federal government offices. The adaptive reuse project at 1600 Callowhill officially opened on May 9.
Designed by BLT Architects, the newly renovated space includes 95 apartments and 2,000 square feet of ground floor retail, as well as a fitness center, parking, and a roof deck. The 1908-built structure was once home to a car company as well as the Middishade Clothing Factory. Until 2017, it served as the U.S. Immigration and Customs Enforcement’s local offices.
PICA: City Sees Double-Digit Increase In April Tax Collections
The City collected approximately $642.2 million in General Fund tax revenue in April 2019, compared to $528.8 million in April 2018, an increase of $113.4 million, or 21.5%, according to preliminary figures from the Pennsylvania Intergovernmental Cooperation Authority (PICA). Increases in almost all tax categories resulted in a year-to-date increase in total collections of 7.3% – surpassing the City’s projection of 2.2% by a substantial margin.
Through April, the business income and receipts tax (BIRT) rose 24.5%, compared to a projected growth of 1.8%; the real estate tax increased 7.8%, compared to a projected growth of 1.5%; the realty transfer tax decreased by -0.3%, compared to a projected -2.6% decrease; and the City sales tax collections rose by 1.1%, compared to a projected growth of 6.0%.
PICA: City Spent $133M On OT Through Q3 Of FY2019
The City of Philadelphia’s overtime costs through the third quarter of fiscal year 2019 totaled approximately $133.1 million, compared to almost $135.4 million over the same period last year – a decrease of $2.3 million, or 1.7%. The Pennsylvania Intergovernmental Cooperation Authority (PICA) found that less than half of the departments reviewed for the report reduced their overtime spending thus far in FY2019, while most of the departments that increased spending did so by negligible margins.
PICA noted that the Fire Department has already spent $11.5 million more on overtime than last year, and $8.9 million more than its allocation. The agency said that in order for the City to remain within its FY2019 overtime allocation, overtime costs must be managed across all departments.
CCD Launches Expanded Homeless Outreach Program
Center City District (CCD) last month launched an expanded version of last year’s combined, homeless outreach effort that helped connect people living on the streets of the District with needed services and shelter. Funded and launched by the CCD and implemented in partnership with Project Home, the Philadelphia Police Department and the city’s Department of Behavioral Health, the 2018 pilot program successfully encouraged 134 people to come off the street and enter social service, mental health and housing programs from April to November 2018.
The collaborative teams resumed their outreach work on April 22 with the number of social service workers from Project Home doubled and with one police officer assigned to each team, as opposed to two in 2018. This enables two teams simultaneously to cover the entire footprint of the Center City District daily, with one team focusing west of Broad Street and the other east of Broad from 10 a.m. to 6 p.m. every weekday.