CPDC Developments Newsletter - 06.09.20

For more than a week, sidewalks, streets and parks in Philadelphia have been filled with protests by citizens outraged by the murders of George Floyd and others before him. We condemn the blatant, violent, criminal misconduct that led to his death without condemning all police. We support the constitutional right to peaceful protest, as we reject vandalism and looting by opportunists.
We must all work together to overcome racism, bigotry and the marginalization of black and brown people in our city.
Our goal remains unchanged: strengthening Center City as the primary setting for work and opportunity in the region and as a vibrant, inclusive place where all Philadelphians feel safe and welcome. Our challenges are daunting. We must focus on rebuilding, reopening, reconciliation and on far more robust and inclusive job growth. We have much to do. We aim to be equal to the task.

News from Center City and the region:

Employment News

Philadelphia’s Payroll Employment Declines by 100K In April

April payroll employment in Philadelphia declined by 100,300 on a seasonally adjusted basis to 647,700, a loss of 13.4% from March, according to the Bureau of Labor Statistics (BLS). City jobs declined in every employment category, with the largest losses in leisure and hospitality (42,400 jobs, a decline of 56% from March). Losses in other sectors were smaller on a percentage basis: health care and social assistance declined by 11,600 jobs (6.6%); educational services fell by 8,000 jobs (10.5%); professional and business services dropped by 10,400 jobs (9.8%); retail trade, 3,400 jobs (6.9%); construction, 3,200 jobs (27%); and other services, 8,200 jobs (29%). Losses were comparatively small in information, a decline of 800 jobs (5.7%); financial activities, 1,200 jobs (2.7%); and government, 800 jobs (0.7%).

The pattern of Philadelphia’s April job loss was similar to the nation’s; the largest losses nationally in April were in leisure and hospitality (a 46% decline), with other losses widely distributed across other sectors, but smaller on a percentage basis.

At the national level, payroll employment rebounded by 2.5 million jobs in May, following April’s historic loss of 20.7 million jobs (a 13.7% decline). Some of the largest gains occurred in construction, retail trade, health care, and leisure and hospitality. This is reflective of both the reopening in other parts of the country and the impact of federal Paycheck Protection Program (PPP). Philadelphia’s May employment figures are not yet available from BLS.

Here is a link to the original BLS data before it is seasonally adjusted.

Retail News

Philadelphia Moves to Yellow Phase, Delays Outdoor Dining Return

Philadelphia has advanced to the yellow phase of pandemic recovery. Among the businesses now allowed to reopen are daycare centers, offices, manufacturing and warehouse operations, and retail. Retailers are encouraged to provide curbside pickup service, though customers are allowed into shops with a limit of five people per 1,000 square feet.

Philadelphia restaurants can continue to provide takeout. Walk-up ordering at restaurants and food trucks is permitted. The city will allow businesses that previously offered outdoor seating to resume outdoor dining on June 12.

Five Below Commits To Opening Up To 120 More Stores In 2020

Five Below Inc. plans to open 100 to 120 additional retail locations this year. The retailer, headquartered in Center City, has opened 40 new stores so far this year and expects to open 100 to 120 more stores in 2020.

Five Below said that it has reopened more than 75% of its 900-plus stores as pandemic lockdown restrictions ease. Locations have reopened in all but four states, where curbside pickup is available as allowed. The company posted 2019 sales of nearly $1.85 billion, up 18% over the year before and more than double from 2015.

Eds & Meds News

CBRE Expands Life Sciences Group Into Philadelphia Market

CBRE has announced an expansion of its Life Sciences Consulting Practice in the Philadelphia market to capitalize on growing local demand, as more than 1 million square feet has been sought in the past year by the life sciences.

Most recently, CBRE arranged a long-term lease of 32,500 square feet for growing biotechnology firm Century Therapeutics at One uCity Square, expected to deliver in 2022.  “This may be an opportune time for developers to consider new buildings or adaptive reuse of existing properties, particularly in University City and Center City, to accommodate the growing life sciences demand,” CBRE stated.

Temple Outlines Steps To Bring Students Back To Campus This Fall

Temple University's president is confident the school can “open on time as a residential university” in the fall, while putting new protocols in place to keep its students, faculty and staff safe. In a letter to the Temple community last week, Temple President Richard Englert said the school is also seeing “strong interest” from first-year students and has received more than 5,600 first-year deposits to attend school in the fall, a roughly 5% increase over 2019.

Temple will begin a return to on-campus operations in phases, he said, and expects it will be able to open for the start of classes on Aug. 24. Classes will be held both in-person and online. Students will not return to campus after the Thanksgiving break.

Transportation News

SEPTA Provides Reopening Guide For Returning Workers

Today, as the region moves into the yellow phase, small numbers of office workers will start returning to Center City. SEPTA has outlined its efforts in a new reopening guide to ensure commuter health and safety, especially relating to cleaning and social distancing.

Enhanced cleaning protocols include: sanitizing every vehicle at least twice a day; deploying trained crews to sanitize high-touch surfaces on trains, buses, trolleys and facilities; reallocating resources to work around the clock cleaning, disinfecting, and overnight power washing at all open stations; and closing select stations and concourse areas to focus resources on cleaning and sanitizing priority stations. SEPTA also is imposing rider limits on buses, trolleys and the Norristown High-Speed Line; installing social distancing decals on vehicle seats to indicate proper rider spacing; and requiring all riders to wear facial coverings.

American Airlines Bringing Back Dozens Of PHL Flights 

American Airlines will ramp up service out of Philadelphia International Airport (PHL) in July after canceling dozens of flights over the last few months due to the pandemic. The dominant carrier at PHL said that by July flights per day at the airport will increase by 99% over June volumes. American will fly an average of 187 daily departures.

American’s peak summer schedule will stretch from July 7 to August 17, and PHL will average 207 daily departures during that time period. As a whole, American will increase frequency to more than 30 markets out of Philadelphia in July.

Frontier Announces 6 New PHL Routes

While the coronavirus pandemic has slowed air travel dramatically, Frontier Airlines has announced the debut of six new routes out of Philadelphia this year. The Denver-based carrier will begin new nonstop flights from PHL to Boston and Chicago beginning July 2 and nonstop service to Phoenix starting November 12.

Frontier previously announced plans to launch three new routes out of PHL this summer. Service will kick off to Myrtle Beach, South Carolina on July 2, Palm Beach County, Florida starting July 3, while service to Florida's Sarasota–Bradenton International Airport started on June 6.

More Employment News

Facebook To Begin Hiring In Philadelphia As It Pivots To Remote Work

Social media giant Facebook will begin hiring in Philadelphia as the company navigates a long-term shift to a more remote workforce in the wake of the COVID-19 pandemic.

CEO Mark Zuckerberg said Facebook plans to “aggressively open up remote hiring” starting July 1 and will begin recruiting in markets close to its existing engineering hubs. This will include cities such as Philadelphia, Portland, San Diego and Pittsburgh, the company said in an email following Zuckerberg’s announcement.

New Tech Accelerator Looking For Philadelphia Startups

A new tech accelerator program based in Washington, D.C., is expanding its geographic approach with its virtual programming efforts, recruiting startups from cities including Philadelphia. Pax Momentum, founded by investor Matthew Hanson, is hoping to drum up interest from Philadelphia’s growing startup sector. 

Talent coming from its universities and large tech-focused employers like Comcast are a major draw, Hanson said. Initial plans are to hold two cohorts of eight to 10 companies a year, focusing on startups operating in the business-to-business world as well as those in tech fields including cybersecurity and enterprise software.

City Government News

City Projects Fund Balance To Drop By $84 Million

The City projects increases in expenses by $37.1 million, and decreases in revenues by $70.4 million, according to PICA’s Quarterly City Managers Report (QCMR) for the third quarter ended March 31. The City’s general fund balance is now projected to end the fiscal year at $268 million, a drop of $84 million compared to the second quarter projection of $352 million.  The City’s response to the COVID-19 pandemic, coupled with a recent decrease in tax revenues, are the factors in the adjusted projections.

As a result of limitations due to the current health crisis, the City issued an abridged version of its data. While PICA said it commended the City for issuing the data in a timely fashion during the pandemic, PICA urged the City to resume its complete reporting “so that stakeholders remain informed on the effectiveness of City Departments during a crisis.”

City Has Spent Almost $150M In OT Through Q3

City of Philadelphia overtime costs totaled $148.9 million, $15.8 million more than through the third quarter of last year, according to PICA’s Overtime Update for the Third Quarter of FY2020. Additionally, PICA’s analysis found City departments spent 89.4% of their total allocation for FY2020 overtime, with one quarter remaining in the fiscal year.

The City projects it will exceed $200 million in overtime costs in FY2020, far surpassing the previous high spending total of $179.4 million, set in FY2018. $148.9 million is also the highest third quarter spending total, surpassing the FY2018 third quarter total of $135.4 million by $13.5 million.

Kenney Pulls Property Tax Increase From Budget Proposal

Mayor Jim Kenney has removed real estate tax increases from his budget proposal after the Pennsylvania legislature approved a $25.8 billion short-term state budget that would fill funding gaps for schools.

The City projected a $649 million budget gap after revenues were slashed because of the coronavirus-related economic downturn. Kenney's proposed budget included a real estate tax increase of about 4%, the equivalent of $58 on a home assessed at $150,000, to fill budget gaps for the School District of Philadelphia.

CCD News

Thanks To CCD’s On-Street Staff

We want to acknowledge the extraordinary work of our on-street teams, who, since mid-March, have been coming to Center City seven days a week from every neighborhood in Philadelphia. Ninety sidewalk cleaners, 51 Community Service Representatives (CSRs) and almost a dozen park and landscape staff have remained on the job – cleaning sidewalks, removing graffiti, sanitizing street furniture, landscaping our parks, assisting the public, performing outreach to the homeless and providing a reassuring presence in the downtown. They were an essential part of the cleanup in Center City after the looting occurred, though credit also goes to hundreds of volunteers who took to the streets with brooms on Sunday morning, May 31. See the inspiring news story: