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Thursday, Dec 29, 2005
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Posted on Tue, Dec. 27, 2005

Center City Renaissance

A residential population boom and retail growth power a comeback.

By Joseph A. Slobodzian
Inquirer Staff Writer

Frank Plateroti and John Mully could have chosen anywhere for a shared weekend getaway for their affluent North Jersey families.

New York? Too difficult to get in and out.

The Jersey Shore? Too overpriced and good only two seasons a year.

A Philadelphia townhouse at 18th and Montrose? Just right.

Plateroti, 54, a communications consultant with a 16-year-old daughter and a 12-year old son, and Mully, 52, a dentist with an 11-year-old son, chose a new Quincy Court townhouse to be near Center City's arts and culture, restaurants and nightlife, affordability, and big-city life on a human scale. Philadelphia is "rich in history and tradition," and easy to get around, Plateroti said. "It's very culturally rich."

That's an opinion shared by an army of out-of-towners, recent college graduates, and suburban empty-nesters who are swelling Center City's population and remaking its neighborhoods.

Consider the following:

Though Philadelphia as a whole is still losing residents, Center City has the third-largest downtown population after New York and Chicago. Since 2000, its population has increased 11.5 percent, from 78,902 to 88,000. Experts say it could reach 96,000 to 105,000 by 2010.

Retail occupancy in Center City is now at 90 percent - 3 percent higher than 2004. This year, the Urban Land Institute listed Center City among the nation's top 10 for urban retailing.

By year's end, says a November report by the Center City District, 8,235 new housing units - new construction and condominium conversions of older buildings - will have been completed since 1997. By 2008, an additional 3,574 will be done - with 7,204 more proposed.

The geographical definition of Center City itself has expanded, thanks to demographic changes. Once, the north and south boundaries were Spring Garden Street and South Street. Now, the Center City District defines it as river to river and Poplar Street to Christian Street - and some believe adding University City is just a matter of time.

Some might say Philadelphia is just having its 15 minutes of fame. After all, 2005 began with the Eagles in the Super Bowl. In July, Philadelphia hosted the only Live 8 concert in the United States. And last month, it was dubbed America's "Next Great City" by National Geographic Traveler magazine.

But even skeptics - and Philadelphians have made an art of pessimism - concede the hype cannot hide what has occurred over the last decade, and what will likely continue.

"No, this is real. Nothing could be more real," said Theodore Hershberg, professor of public policy and history and director of the Center for Greater Philadelphia at University of Pennsylvania.

Hershberg, 64, has made Philadelphia his laboratory in almost 40 years of urban public-policy research. A longtime resident of West Mount Airy, Hershberg was not always sanguine about the city's future.

His attitude has changed. Hershberg recalled walking with his wife through Old City on a recent Friday night. The streets were packed.

"I couldn't stop smiling," Hershberg said. "Who would believe all these people? It was almost like being in New York."

Hershberg dates Center City's rebirth to the Rendell administration, the 1991 creation of the Center City District, and the unflagging optimism and energy of district director Paul R. Levy.

Funded with assessments on Center City property owners, the district improved cleanliness and public safety in the downtown neighborhoods most traveled by tourists and workers. It also has gone much further, becoming Philadelphia's biggest booster and advocate - not above calling city officials about broken curbs, clogged sewers, overflowing trash cans, and burned-out lights.

"It's remarkable, but everything has finally reached a critical mass," Hershberg said. "There's no measure that I can think of that anyone could look at and say, 'This is not working.' "

Developers are certainly taking bets. This year, architect George L. Claflen Jr. and several fellow members of the volunteer Design Advocacy Group tallied current and proposed Center City construction projects.

The list, which Design Advocacy Group made public in June, stunned even members - about 130 projects, a total of more than 35 million square feet of space and $7 billion in construction.

And most - 97 projects involving 12 million square feet of space - were residential: 1,635 apartments, 7,085 condominiums and 465 single homes.

If all those projects are built, "that means 18,000 people moving into Center City Philadelphia," Claflen said. "We're going to see the look of this city change dramatically."

Center City's retail sector is trying to catch up with its growing population of potential customers. Experts maintain that Center City remains "underserved" by movie theaters and sporting goods, electronics, appliance and furniture stores.

Yet, a Center City District survey this fall showed a slight increase over 2004 in the number of retail sites: 2,468 retail spaces occupying 4.1 million square feet.

The change can be seen in storefronts. In the last five years, Chestnut Street has risen from the dead, recovering after a 1975 decision to ban automotive traffic turned it into a windswept, vacant strip.

The vacancy rate on Chestnut from Broad Street to the Schuylkill dropped last year from 15.6 percent to 8 percent - thanks to tony additions such as DiBruno Bros.' $3 million food emporium and Stephen Starr's restaurant Continental Mid-Town.

Nor is the renaissance limited to west of Broad. In the 1300 block, the Mitchell Gold + Bob Williams furniture store has opened and a West Elm store will share a former Woolworth's with Lucky Strike Lanes, one of a chain of glitzy, themed bowling alleys.

"This year has been so unbelievable that it scares me," said Ann Gitter, owner of Knit Wit, a high-fashion women's clothing store at 1718 Walnut St.

The downtown rebirth hitting Philadelphia is not unique. A Brookings Institution study released last month, analyzing demographics in 44 cities from 1970 to 2000, showed that city downtowns grew by an average of 10 percent in the 1990s, a "marked resurgence following 20 years of overall decline."

The study, "Who Lives Downtown," reported that during the 30-year period, the cities saw an 8 percent increase in the number of downtown households and a doubling of the rate of home ownership.

The Brookings study also confirmed that Center City Philadelphia's population mix is not unusual: smaller households of singles, unrelated people living together, and childless marrieds, including "empty nesters."

In August, the Center City District polled residents of the last 13 condominiums built in Center City. Half those responding were between 25 and 44 years old, but 18 percent were over 55.

And almost a quarter said they came to Center City from the suburbs - 18 percent from Pennsylvania and the rest from New Jersey.

These are the people who brought David Krieger to Philadelphia. Krieger, a vice president and branch manager for Coldwell Banker Preferred Real Estate, worked for years in Conshohocken.

But three years ago, Krieger said, he and his brokers started getting increasing numbers of calls from people asking to see Center City homes. The company has since opened two new city offices.

"We felt it was critical that we be in Center City," Krieger said.

Philadelphia's real estate tax abatements - a 10-year abatement on conversion of vacant buildings into residential units passed in 1997 and a 2000 10-year tax break for new residential construction - played a large role in sparking the boom, Krieger said.

But he also credited public improvements and the creation of the Avenue of the Arts on South Broad Street with making Philadelphia into a "destination city."

Robin Morris agrees.

Morris, 31, has lived and worked in New York City and Boston. A year ago, she came to Philadelphia for a graduate degree in history at the University of Pennsylvania.

Now in South Philadelphia, Morris says she wants to buy - and stay - in Center City.

"When I lived in New York City and Boston, I hardly lived in the city," Morris said. "It's hard to find a place like Philadelphia, where I can open up the door of my rowhouse, walk two blocks, and go to the theater. And it's affordable. There's a lot of life downtown."

At the other end of the spectrum are architects Peta Raabe, 53, and Peter Bloomfield, 54.

The couple were "urban pioneers" in 1980, buying and renovating a rowhouse at 18th and Bainbridge Streets.

Twelve years later, though, the couple followed a traditional city-to-suburbs migrating pattern, moving to Merion in Montgomery County when their children were school-age.

The suburban schools turned out not to be up to their expectations, however, and their two children wound up in a private school. Finally, in April 2004, with one child in college and another almost out of high school, the family decided to return to Center City.

This time, they bought in Society Hill - a house with parking for two cars and a small garden for a touch of green.

"It's the best of both worlds," Raabe said. "We really always thought we'd go back."

Raabe and Morris both said they love Philadelphia's human scale and walkability, an asset often lost on Philadelphia natives - although they are catching on.

One reason is prices and rapidly appreciating home values. Dan Tobey, the Coldwell Banker broker who sold Plateroti and Mully their townhouse at Quincy Court, took his own advice and bought a unit on the former vacant lot. Townhomes that started at $425,000 last year have only gone up.

"People from Los Angeles and San Francisco see this and ask, 'What's wrong with this? It's only six blocks from Rittenhouse Square,' " Tobey said. "The prices can't be this cheap."

In some cases, they aren't. Marking another benchmark for upscale Philadelphia, Prudential Fox & Roach vice president Joanne Davidow said she sold, in two days, a $1.5 million condominium unit (to empty-nesters) and a home in Center City for $3 million (to a young "self-made couple" moving into the city).

"Everyone asks, 'Who is buying this?' And the answer is, 'Everybody,' " Davidow said at a recent meeting of the Central Philadelphia Development Corp. "Two million has become the new one million."

With Center City prices on that kind of upswing, the transformation is spreading to border neighborhoods such as Northern Liberties, Fairmount and Pennsport.

By decade's end, experts say, Center City's boundary with University City could become a distinction without a difference, and development could be moving beyond Girard Avenue on the north and Washington Avenue to the south.

Yet there are clouds surrounding Center City's silver lining.

Education remains Philadelphia's most vulnerable point. The Center City District recently polled day-care centers and preschools and is estimating, based on current application trends, that the number of school-age children could increase by 43 percent in 2010.

"This could be a huge opportunity for the public schools and the independent schools of Center City," Levy said.

Another is Philadelphia's outmoded zoning code and attitude toward investors, which some warn could let developers run roughshod over public spaces - parks and open access to the Delaware and Schuylkill waterfronts - that attracted new residents in the first place.

Philadelphia used to "agree to anything because we were desperate for people to invest in us," said William P. Becker, cofounder and chairman of the Design Advocacy Group. "We are way beyond that. To be a world-class city, we need to think like a world-class city."

And that, some say, involves a culture change that could go hand in hand with Philadelphia's new faces. Hugh C. Long II, Wachovia Bank's chief executive officer in Pennsylvania and Delaware, has called for business leaders to take a more active role in Philadelphia's future - including bidding for the 2016 Olympics.

"We are at the beginning of Center City's shining moment," he said. "Our job is to put a mechanism in place to make sure this shining moment lasts well beyond us and far into the future."

Contact staff writer Joseph A. Slobodzian at 215-854-2985 or jslobodzian@phillynews.com.

Moving Up in Center City

Selected key changes and events in Center City

1987: One Liberty Place at 1650 Market St. is completed by Rouse & Associates - the first of several office towers to surpass the height of City Hall.

1991: Center City District begins cleaning streets.

1992: Ed Rendell begins first term as mayor of Philadelphia.

1993: Convention Center opens.

1993: Avenue of the Arts is created on South Broad Street.

1994: Reading Terminal Market is renovated.

1994: Striped Bass restaurant opens and garners national attention.

1995: The 1,200-room Philadelphia Marriott opens adjacent to the Convention Center.

1996: Rendell begins second term as mayor.

1996: Greater Philadelphia Tourism Marketing Corp. is created to market the five-county region.

1997: City Council passes a 10-year tax abatement to spur redevelopment of old office buildings for residential use.

2000: John Street begins his first term as mayor.

2000: City Council amends the tax abatement program to include new construction.

2000: Philadelphia hosts the Republican National Convention.

2001: The $265 million Kimmel Center is completed.

2003: The $185 million National Constitution Center opens.

2004: Street begins second term as mayor.

2005: Construction of the $459.6 million, 1.2 million-square-foot Comcast Center begins. When completed, it will be taller than One Liberty Place.

2005: Live 8 concert held along Ben Franklin Parkway.

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