CPDC Developments Newsletter - 11.12.19

Municipal Election News

City Council 2020

In a Philadelphia Business Journal summary, reporter Jeff Blumenthal writes, “With four new members elected to Philadelphia City Council Tuesday, including one from the left-wing Working Families Party, advocating for a pro-business agenda will become more difficult than it already is. That’s the consensus of three government relations professionals familiar with the inner workings of the City Hall’s fourth floor.”

Other observers who were quoted in the piece noted the opportunities for those who favor a job growth agenda to work with some new members in Council.

“The Ground Rules Are Changing”

WHYY’s PlanPhilly noted that newly elected members of Philadelphia City Council “will mean new dynamics for Philadelphia neighborhoods,” especially regarding “brick-and-mortar issues of city governance: zoning maps, streets rules, land sales and development policies.”

Working Families Party candidate Kendra Brooks, the first third-party contender to win a Philadelphia City Council at-large seat in the modern era, campaigned on an agenda to end the 10-year property tax abatement and improve public services from the city’s parks system to SEPTA. Brooks said she wants the public transit authority to eliminate fares for children and end transfer fees.

Two new Democratic at-large members will also be joining City Council’s ranks. Neither has expressed a particular interest in land use, development or housing issues, although Isaiah Thomas told WHYY last spring that he supports rent stabilization policies.

As outgoing Councilmember Blondell Reynolds Brown’s former chief of staff, Katherine Gilmore Richardson has experience working on zoning. Both Thomas and Gilmore-Richardson have strong relationships with Darrell Clarke and are expected to support his bid to remain City Council President. It remains unclear how they will vote on issues Clarke favors, such as increasing parking minimums. 

New Councilmember Jamie Gauthier, who unseated Jannie Blackwell in the Democratic primary election last spring, said she plans to focus on updating her district’s zoning maps immediately. The University of Pennsylvania-educated urban planner will also be adding a city planner to her staff, in order to help constituents participate in the remapping process and negotiate with developers.

Viewpoint: “Philadelphia's Left Needs To Get Government Right”

Former city financial and policy analyst Brett Mandel, in a post-election opinion piece, urges Philadelphia’s progressive leaders “to do much more to focus on getting government right.”

“A focus on progressive thinking in Philadelphia has not been matched by a call for government to deliver a better product at a lower cost. It costs far too much to run Philadelphia poorly, but too few on the city’s political left focus on government efficiency. When government costs more, that burden falls disproportionately on our lowest-income citizens.

“When government services cost too much, we cannot extend them to people who need help. There is a reason that Philadelphia is the poorest of the nation’s largest cities and it is not that our city is run by right-wingers. We need to demand government efficiency with the same loud and clear voice as we demand equality and tolerance. Passionate calls for social justice in Philadelphia have not been matched by an impatient demand for government competence,” Mandel writes.

Employment News

Inquirer Asks: “Where Are The Jobs?”

The Philadelphia Inquirer’s business columnist, Joseph DiStefano, cited the new CCD/CPDC report in a post-election column noting that the city “has no shortage of pro-worker talk, just a shortage of well-paying employers.”

DiStefano writes, “According to the (CCD) report, 60% of the jobs created in Philadelphia in the last 10 years pay less than $35,000 a year. … That’s a contrast with Boston, New York and other big cities, where new jobs tend to be in private-sector fields that pay higher, ‘family-sustaining’ wages. Philadelphia’s pro-worker legislation has not attracted private employers.”

The CCD/CPDC report referenced in the piece, called Growing More Family Sustaining Jobs in Philadelphia, found that after decades of economic contraction, the city has added jobs for nine straight years, an unbroken growth streak not seen since the boom years of World War II. However, the city has grown a disproportionately larger share of lower wage jobs than the nation and the 25 largest American cities.

Development News

Fitness Club Equinox To Open In New Rittenhouse Square Tower

The Equinox fitness chain is set to open its first Philadelphia location at The Laurel. The premier health club, based in New York City, will occupy nearly 7,000 square feet on the first three floors of the 48-story tower at 1911 Walnut Street, according to lease documents filed with the Philadelphia records office.

The chain’s current closest locations are in North Jersey, New York, and the Washington, D.C. area. Plans from Nashville-based developer Southern Land Co. also include 60 condo units and 184 apartments for the $300 million project, which is expected to be completed in 2021.

DRWC Seeks Proposals For 2 Undeveloped Waterfront Parcels

The Delaware River Waterfront Corp. is seeking proposals from developers for two waterfront parcels totaling approximately 11 acres. One site is about 7.5 acres between Market and Chestnut streets; the other site is almost 4 acres and is located between Spruce and Lombard streets.

The vision is to transform both sites, currently used as parking lots or for seasonal activities, into mixed-use buildings with housing, hotels, and ground-floor retail and restaurants framing the marina and the riverside. JLL is overseeing the process. Proposals are due by February 7.

Eds & Meds News

Penn Gene-Editing Study Finds No Major Side Effects In Early Trials

Three patients with advanced cancers, treated at the University of Pennsylvania in the first U.S. clinical study of gene editing, have had no serious side effects so far — an early indicator that the technology can safely be used in humans. The trial is being funded by the Parker Institute for Cancer Immunotherapy — an initiative of billionaire tech guru Sean Parker — and Tmunity, a Philadelphia biotech company.

For the clinical trial, doctors took immune system cells from the patients’ blood and altered them genetically to help them better recognize and fight cancer, with minimal and manageable side effects. The treatment deletes three genes that might have been hindering these cells’ ability to attack the disease, and adds a new, fourth feature to help them fight the cancer cells.

Penn Law School To Be Renamed After Record-Breaking $125M Gift

The University of Pennsylvania law school will become the Carey Law School after receiving a $125 million gift, the largest ever to a law school. The W.P. Carey Foundation's donation will be directed toward increasing financial aid for historically underrepresented students, expand its pro bono program and recruiting top-tier faculty.

Funding will also go toward building up interdisciplinary and entrepreneurial programming. The foundation's had a "long and deep history" as the family's connection with the university dates back more than 100 years and the most recent gift is specifically in honor of Francis J. Carey, who graduated from Penn undergrad in 1945 and its law school in 1949.

Retail News

Fashion District Sees Stronger Than Expected Sales

Fashion District Philadelphia has seen more than a million people visitors since its grand opening September 19 and retailers are so far reporting strong sales, according to Pennsylvania Real Estate Investment Trust. During the opening week, 87% of the mall's retailers indicated they had sales ahead of expectations and some retailers reported results that were double or triple their initial projections, PREIT CEO Joe Coradino said during a third quarter conference call with analysts on October 30.  

The initial strong showing at Fashion District has prompted PREIT to be more selective when it comes to signing new tenants to the rest of the 1.1-million-square-foot retail development. So far, 80% of the project is leased and PREIT is in negotiations with tenants who will take another 6% of the unleased space. PREIT reported third-quarter net income of $17.4 million, or 22 cents per share, compared to a net loss of $7.6 million or 11 cents per share a year earlier.

Primark, Kate Spade, Sephora Sign Leases At Fashion District

Primark, an Irish-based retailer, has signed a 34,200-square-foot lease at the corner of 11th and Market streets at the redeveloped Fashion District Philadelphia. The fast-fashion apparel brand is expected to open in Center City sometime between September 2020 and September 2021, which is the company’s fiscal year.

PREIT announced that luxury cosmetics chain Sephora and women’s designer goods maker Kate Spade New York also will be joining the growing line-up of stores. The Fashion District opened last month after a $425 million renovation and has a mix of apparel, entertainment and dining tenants.

Glen-Gery Picks Center City for 1st North American Retail Store

The parent company of Glen-Gery Corp., a brick and stone manufacturer, has signed a lease to open a 3,500 square foot retail store at the Witherspoon building at 13th and Walnut streets. Philadelphia will be the first North American retail location and follows the successful launch of similar spaces in major cities in Australia, which is where Brickworks Ltd. — Glen-Gery’s parent company — is headquartered.

The company anticipates spending $2 million fitting out the space, which will serve as a showroom for architects, developers, designers and others can view samples of traditional, handmade and pure glass bricks that can cost up to $65 each. Glen-Gery is the fourth largest brick maker in the U.S., with 10 manufacturing plants producing 150 million bricks a year.

Online Startup Retailer Opens Store In Old City

Hitched, an online retailer of men’s wedding bands, and apparel retailer the The Groomsman Suit, have leased space in Old City for its second duel-branded location that serves as an example of new retailers starting out online only to find having a brick-and-mortar presence is an important element of their business strategy. 

Both businesses are seeking to provide a contemporary alternative to two aspects of the traditional wedding business — buying a wedding band for the groom and buying rather than renting a wedding suit or tuxedo. The two retailers have leased 1,800 square feet for their showroom at 67 North 2nd Street.

Transportation News

SEPTA Testing ‘Queue Jump’ For Buses To Battle Congestion

SEPTA and the City of Philadelphia are testing a new traffic signal at the corner of 15th and Market streets designed to prevent buses from getting blocked at intersections by other vehicles by giving a three-second head start over traffic. The so-called queue jump signals are successfully used on the city’s trolley lines, and the hope is that installing the signals at busy bus corridors will ease congestion in Center City. 

Starting this month, eastbound SEPTA buses approaching 15th and Market will follow the new LED traffic signal, which uses a white bar that indicates whether to stop or go. Bus drivers know to brake when the bar is horizontal and move again once it switches to vertical. They have three seconds to proceed before the traffic light turns green for other vehicles.

As noted in CCD/CPDC’s 2018 congestion report, Keep Philadelphia Moving, the increase in jobs and residents, new tourist destinations, hotels, retail and restaurants has led to an increase in car, bus and truck traffic and a 30% increase in pedestrians since the end of the recession. CPDC, along with the Philadelphia Police Department, expressed support for the addition of traffic enforcement officers to relieve downtown’s worsening congestion, as did 69% of Philadelphians who voted in the May 2019 primary election.

Cash Tolls To End By Late 2021 On Pennsylvania Turnpike

After four years of testing, the Pennsylvania Turnpike Commission is proceeding with a $129 million project to become a completely cashless toll system.

While the system will stop taking cash by fall 2021, the agency expects to continue using toll booths at some exit ramps across the state until 2026. Those booths will record E-ZPass transponder signals or take license plate photographs so the agency can mail bills to drivers until the agency finishes installing 43 overhead gantries throughout the turnpike’s 552 miles.

Economic News

PhilaPort Opens 1st New Terminal In 45 Years

The Port of Philadelphia (PhilaPort) has officially opened its first port terminal in more than 45 years. The $110 million 155-acre Southport Auto Terminal and Vehicle Processing Center. State officials said the new auto processing facility has the potential to create at least 7,000 jobs and generate $40 million in annual revenue for governments in the Philadelphia region.

The opening of the Southport Auto Terminal increases PhilaPort’s vehicle processing capability by nearly 70%, from 600 cars per day to 1,000. Glovis America Inc., a third-party logistics provider for Hyundai Auto Group, operates the vehicle processing center.

City Government News

City Council Passes Overhaul For Public Land Sale Process

A package of changes to Philadelphia’s public land sale process have been approved unanimously in City Council. The legislation, introduced in June by Councilmember María Quiñones-Sánchez on behalf of Council President Darrell Clarke, aims to streamline the overall land sale process, increase the number of properties sold to minority- or woman-owned companies, and discourage land-flipping.

The legislative package came in the wake of news reports detailing issues with the sale process’s efficiency and, in some instances, linking Clarke and other council offices to requests for proposals or sales that appeared to favor politically connected individuals.


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