Office Sector News
CBD Occupancy Rate Up in 1st Quarter
The vacancy rate in Philadelphia�s central business district
(CBD) fell from 12.85% at the end of 2014 to 12.4%, as 198,000 square feet (SF)
of inventory was occupied, according to the Philadelphia CBD
Office Market Report, 2015 1st Quarter from Newmark Grubb Knight Frank.
The University City submarket
had the highest average asking rents at $32.55, along with a 3.3% vacancy
rate, followed closely by the largest submarket, West Market, with average
asking rents of $29.98 and a 13.6% vacancy rate. Class A space in the CBD
Currently there is 2 million SF of new office space under
construction in the CBD and when the Comcast Innovation
and Technology Center is completed in 2017, the CBD will have more than 45 million SF of office
space for the first time.
Two Office Towers Sold
CBRE Global Investors has bought the 20-story United
Plaza at 30 South 17th Street for approximately $101.98 million and the 27-story 1650
Arch Street for $69.69 million, the Philadelphia
Business Journal reported on May 15.
TIER REIT, formerly Behringer Harvard REIT I Inc. of Dallas, was the seller. JLL arranged the transaction.
To read the article, please go to bit.ly/1KSBypO.
Former Gimbel Bros. Building Sold
Digital Realty Trust of San Francisco has sold the 14-story 833
Chestnut Street for $161 million to HCP Inc., an Irvine, California, real estate investment trust that focuses on healthcare-oriented properties, the Philadelphia
Business Journal reported on May 6. Among the tenants are Jefferson
Health System and data centers.
The property was once the home to Gimbel
Bros. department store and underwent a $40 million renovation in 2000.
To read the article, please go to bit.ly/1KmsRDP.
Accounting Firm Opens Center City Office
Milwaukee-based accounting firm Wipfli, which acquired Media-based
Elko & Associates in January, has leased 8,000 square feet on the seventh
floor of Three Logan Square (1717 Arch Street), the Philadelphia
Business Journal reported on May 15. The company has moved 20 of its 90 employees
from the Media office and plans to move an additional 15 into the downtown
office, the article noted.
CBRE represented Wipfli in negotiating
the seven-year lease with Brandywine Realty Trust.
To read the article, please
go to bit.ly/1FoEEUx.
BNY Mellon Downsizing Office Space
Bank of New York Mellon has signed an 11-year renewal lease for 48,000 square feet (SF) in the namesake BNY
Mellon Center at 1735 Market Street, reducing its space by 184,000 SF, The
Philadelphia Inquirer reported on May 7.
The bank will make the transition in September.
To read the article, please go to bit.ly/1IjWFUn.
Comparing Tax Structures
Writing in the new Sunday Business section of The
Philadelphia Inquirer, reporter Harold
a detailed comparison of occupancy costs in the city and the suburbs, highlighting the differential caused by Philadelphia�s tax structure.
To read the article, please go to bit.ly/1IKh0B4.
The Gallery on Planning Commission Agenda Tuesday
The Philadelphia City Planning
Commission has four action items, relating to recent City Council legislation for The
Gallery at Market East redevelopment on the agenda for its meeting on Tuesday,
May 19, at 1:00 p.m. at One
Parkway Building, 1515 Arch Street, 18th Floor. The four bills were introduced on April 23 by Councilman Mark
Squilla. They are:
Bill #150375, which authorizes the Commissioner of Public Property, the Director of Commerce, and other officials of the City to execute or approve various necessary agreements by and among the City, the Philadelphia Redevelopment Authority, the Philadelphia Authority for Industrial Development and the developers. bit.ly/1JKAunp
Bill #150376, which revises the City Plan through striking and vacating subsurface and aerial portions of Market Street, 9th Street, 10th Street and 11th Street. bit.ly/1FrynWy
Bill #150377, which would allow large-format signs, ground signs, marquees and planters in the development. bit.ly/1GpId7B
Bill #150379, which creates sign regulations for the Market Street East Retail Area bounded by Market Street, 8th Street, Filbert Street, and 11th Street. bit.ly/1OwnEQo
To read an article in The Philadelphia
the City relinquishing its maintenance obligations for the property,
please go to bit.ly/1KSuSrS.
DRWC Advancing Festival Pier Development
The Delaware River Waterfront
Corporation (DRWC) has chosen three finalists to develop Festival
Pier, an 11-acre pier on the Delaware River at Spring Garden Street and Delaware Avenue, the Philadelphia
Business Journal reported on May 12.
The three are the Jefferson Apartment
Group of McLean, Virginia, and Haverford
Properties Inc. of Haverford; RAL Companies & Affiliates
LLC of New York City; and Toll Brothers
Inc. of Horsham.
The three were chosen from a pool of eight companies that expressed interest in developing a large-scale, mixed-use complex with a residential anchor. Request for proposals from the trio are due July 1.
To read the article, please go to bit.ly/1IzkEO7.
Economic Development News
Creating Economic Opportunity
In advance of a conference they are hosting this week in the aftermath of events in Baltimore, Amy
Liu of the Brookings Institution has summarized recommendations for creating opportunities for residents in high poverty urban neighborhoods in a blog post titled �Beyond Baltimore: Building on What We Know to Create Neighborhood Opportunities.�
To read the article, please go to brook.gs/1Hb61fE.
Reading Terminal Market Has New General Manager
Anuj Gupta has been named General Manager of the Reading
Terminal Market, the Board of Directors of the Reading Terminal Market Corporation (RTMC) announced on May 15.
Gupta follows Paul Steinke, who managed the Market for the past 13 years and resigned on December 31to launch his campaign for at-large member of City Council.
Prior to joining RTMC, Gupta served as the Executive Director of Mt.
Airy, USA, a nonprofit community development corporation in Northwest Philadelphia.
To read the press release, please go to bit.ly/1EMBeoZ.
SugarHouse Revenue Up in March
Revenue rose substantially during March at SugarHouse
Casino on the Delaware River, according to the Pennsylvania
Gaming Control Board.
In March, the casino took in $25,461,526, compared to $22,983,591 in February. The Commonwealth�s share of taxes in March was $6,705,518, compared to February�s $6,210,422. The City of Philadelphia collected $837,862, compared to $770,033 in February.
To see all casino revenues, please go to bit.ly/1KdV9QV.
Number of Tourists Increased Last Year
In 2014, 39.7 million people visited Philadelphia with an economic impact of $10.4 billion, the Philadelphia
Business Journal reported, citing Visit Philadelphia�s new annual report released on Friday.
Last year, visitors filled 3.1 million hotel room nights in Center City, and 30.9% were business travelers, while 33.5% were group travelers, and 30.7% were leisure travelers.
Philadelphia's Saturday night hotel occupancy is 88.2%,
second only to New York�s at 90.4% and ahead of Boston�s, Baltimore�s and
Washington, D.C.�s, The
Philadelphia Inquirer noted, citing the same report. To read the Philadelphia
Business Journal article, please go to bit.ly/1GddfDT.
To read The Philadelphia Inquirer article, please
go to bit.ly/1PLo5S8.
To read the Visit Philadelphia report, please go to vstphl.ly/1POXio5.
Convention Authority Files Suit Against Carpenters
The Pennsylvania Convention Center
Authority on May 7 filed a federal lawsuit against the Metropolitan
Regional Council of Carpenters, one of two unions barred from working at the Convention Center, and seeks to recover more than $1 million in damages from the union, the Philadelphia
Business Journal reported.
The lawsuit alleges a pattern of �prolonged and coordinated violent, illegal and extortionate conduct," the article noted and was filed under the Racketeering Influenced and Corrupt Organization (RICO) Act.
The Carpenters and Teamsters unions were barred from working at the Convention Center last year after failing to sign the new Customer Satisfaction Agreement by the deadline.
To read the article, please go to bit.ly/1Jww0AY.
Tax on Short-Term Rentals Proposed
On May 7, Councilman William
K. Greenlee introduced on behalf of the Nutter Administration Bill
#150441 that would tax short-term rentals advertised on Airbnb,
Craigslists and similar sites, at the same rate that hotels are taxed, currently
8.5%, The Philadelphia Inquirer reported.
Rentals of 30 days or less would be taxed, while those longer than 30 days would need a rental license. The legislation would take effect July 1. Hotel tax revenue is split between the Philadelphia Convention and Visitors Bureau, Visit Philadelphia, and the Pennsylvania Convention Center, the article noted.
The Committee on Rules will hold a public hearing on the bill on Monday, June 1, at 10:00 a.m. in Room 400 of City Hall.
To read the article, please go to bit.ly/1F48knS.
To read Bill #150441, please go to bit.ly/1JauCGl.
New Hotel on Drexel Campus
The official groundbreaking for The
Study at University City, a 212- room hotel at 33rd and Chestnut Streets on the campus of Drexel
University, was held on May 8, Drexel Now reported. Amenities in the new hotel will include 7,000 square feet of banquet/meeting space, a 105-seat corner restaurant and bar, and a state-of-the-art fitness center.
Expected to open in fall 2016, the hotel was designed by DIGSAU architects, and P.
Agnes is managing the construction. The hotel will be owned by Hospitality
3 and operated by its subsidiary, Study
To read the Drexel Now article, please go to bit.ly/1L0qeZx.
Residential Market News
Mixed Signals in Region�s 1st Quarter House Sales
The typical Philadelphia-region home fell in value by 1.8% on a quality- and seasonally-adjusted basis during the 1st quarter of 2015; with a 0.3% dip in Philadelphia County and a 2.3% drop in the 10-county suburbs, according to Kevin
C. Gillen, Senior Research Fellow with the Lindy Institute for Urban Innovation at Drexel
University, in a report released on May 5. Montgomery was the only county to see an increase (+0.3%).
The number of homes listed for sale declined to 30,000 units in the quarter, down from 35,000 units in the previous quarter and 55,000 in 2011.
There were 3,061 arms-length transactions in Philadelphia County in the 1st quarter, down from 3,148 in the same quarter last year and in the 10-county suburbs, the volume rose from 7,908 to 9,032 in the same period.
To read the report, please go to bit.ly/1JOz0sb.
Rental Townhouses Coming to Queen Village
By the end of 2015, U.S. Construction
Inc. expects to finish building BridgeView, a $30 million development of 75 rental townhouses along Columbus Boulevard just north of Catherine Street in Queen Village, the Philadelphia
Business Journal reported on May 8.
The project was designed by JKR
Partners, with five pocket parks, a playground, dog park and on-street parking. Rents are expected to range between $3,000 and $3,500.
To read the article, please go to bit.ly/1KrdgD7 (requires
Textile Lofts Sold
Textile Lofts, a mixed-use property with 29 apartments and 26,000 square feet of retail space at 21st and South Streets was sold by Grasso
Holdings to Alterra Property, the Philadelphia
Business Journal reported on May 11.
Grasso Holdings renovated the property in 2011. MPN
Real Estate arranged the sale.
To read the article, please go to bit.ly/1JF3iOg.
Arts and Culture News
NEA Grants Awarded
The National Endowment for the
Arts (NEA) on May 6 announced awards totaling $74 million for community-based art projects across the country.
Among the local grantees were the Greater
Philadelphia Cultural Alliance ($35,000) to support the Phillyfunpass, to foster a deeper engagement with patrons and audiences, and the Philadelphia
Orchestra ($70,000), to support free neighborhood concerts and PlayINs throughout the city. In addition, the Commonwealth
of Pennsylvania Council on the Arts received $917,700 to support partnerships in the state.
To read the press release and view a complete list of
grantees, please go to 1.usa.gov/1IObEVE.
State Senate Confirms Leslie Richards
Governor Tom Wolf�s nominee for Secretary of Transportation, Leslie
Richards, was unanimously confirmed by the state Senate on May 11, according to Pennsylvania Legislative Services, a subscription reporting service.
Three other nominees were also unanimously confirmed. They were: Secretary of General Services Curtis
Topper; Secretary of Economic and Community Development Dennis
Davin; and Adjutant General James Josephs.
PennDOT Announces Travel Restrictions
The Pennsylvania Department of
Transportation (PennDOT) on Friday announced travel restrictions scheduled this week for I-76 and I-95 in Center City.
On Monday, May 18, the left lane will be closed on eastbound and westbound I-76 between Spring Garden Street and Montgomery Drive from 9:00 a.m. to 2:00 p.m. for concrete barrier repair.
On Monday, May 18, through Thursday, May 21, the Lombard Street on-ramp to I-95 North will be closed and detoured from 7:00 a.m. to 3:00 p.m. for deck repairs. Motorists traveling on Christopher Columbus Boulevard will be directed to use the Washington Avenue or Race Street on-ramps to reach northbound I-95.
Complete information can be found at 511PA.com.
Parks and Open Space News
Coming Next Week! The Farmers� Market at Dilworth Park
Beginning Wednesday, May 27, and continuing every
Wednesday throughout the summer and fall, from 11:00
a.m. to 2:00 p.m., the Center City District, in collaboration with Farm
to City, will open the Farmers� Market at Dilworth Park.
McCann�s Farm of Elk Township, New Jersey, will offer up a variety of vegetables, from asparagus to zucchini, plus other seasonal delights including the first strawberries in May and the giant pumpkins of October.
In addition, PetAl Plants & Flowers of New Jersey will stock a wide variety of houseplants, flowers and vegetable starters for your own garden.
For more information, please visit ccdparks.org/dilworth-park.
Art Commission, City Council Committee Approve Rail Park Plans
The Philadelphia Art Commission on May 6 approved the conceptual design created by Studio|
Bryan Hanes and Urban Engineers for the $9.6 million Reading
Viaduct Rail Park, Phase 1. The 0.80-acre linear park will run between North Broad Street, the north side of Noble Street, 11th Street and the south side of Callowhill Street.
On May 14, Bill #150415 that would allow the City�s Department
of Public Property to acquire the parcel and lease it to SEPTA was voted out of committee and is on the Council�s agenda for a final reading and vote on Thursday, May 21. SEPTA will lease the land to the Center City District (CCD) for renovation purposes. Upon completion, the CCD will turn the completed project over to the City of Philadelphia.
To learn how you can support the Rail Park, please see item below in Upcoming
To read Bill #150415, please go to bit.ly/1zkPjwS.
To review plans for the Reading Viaduct project, please go to centercityphila.org/about/viaduct.php.
To view a complete set of renderings, please go to studiobryanhanes.com/work#/viaduct.
New Upgrades at The Porch
The Porch at 30th Street Station is nearing completion of new amenities and a new food and beverages partnership with restaurateur Michael
Schulson, according to the University City District (UCD).
The improvements include brightly-painted wooden swings designed by Gehl
Studio, new landscaping design from Groundswell
Design Group and Michael Schulson�s Rotisserie
at the Porch, which includes a parked food truck with a newly installed rotisserie plus a beverage trailer that will offer beer and liquor options.
For more information, please go to bit.ly/1Fl6DEq.
New PICA Board Member
President pro tempore of the Senate Joseph
B. Scarnati has appointed Joseph M. McColgan, Regional Vice President of Fisher
Investments, to the board of the Pennsylvania
Intergovernmental Cooperation Authority (PICA).
To read about McColgan, please go to joe-mccolgan.fisherinvestments.com.
State House Passes Property Tax Reform Bill
The state House of Representatives on May 13 passed HB
504, which would lower school property taxes statewide and increase the state personal income tax from 3.07% to 3.7% and the sales tax from 6% to 7%. The vote was 105-86. The bill now goes to the state Senate.
Governor Tom Wolf�s plan calls for raising the sales tax to 6.6% for most parts of the Commonwealth and significantly expanding the items subject to the tax, with a portion of the sales and use tax revenue earmarked for property tax relief.
To read about HB 504 in The Philadelphia
Inquirer, please go to bit.ly/1IDJ7lt.
To read HB 504, please go to bit.ly/1PLxOIi.
Exercising Leadership for Change
In city government, the hard work of change isn�t
flashy, but it requires spending political capital to advance a handful
of top priorities, Jeremy
Nowak writes in The Philadelphia Citizen. To read the commentary, �What
We Talk About When We Talk About Innovation,� please go to bit.ly/1Kr3DV0.
City Offers Aid to Commercial Recyclers
The City of Philadelphia�s Recycling
Office has released a new commercial recycling toolkit that explains
legal recycling requirements and how to implement successful, cost-effective
recycling programs. To read the tips on recycling, please go to bit.ly/1BIU8KK.
Tomorrow! Primary Election Day
The Committee of Seventy is reminding everyone that tomorrow, Tuesday,
May 19, is Primary Election Day. Polls are open from 7:00 a.m. to 8:00 p.m.
If you have moved and aren�t sure where your polling
place is, find it here: bit.ly/1qfQGHP.
For complete information on the election, please go to bit.ly/1GdkVGj.
Drexel and Econsult Joint Conference
Join Drexel School of Economics and Econsult
Solutions, Inc. (ESI) for their first free annual
joint conference on Thursday, May 21, at the Gerri
C. LeBow Hall, 3220 Market Street, Room 220 Grand Meeting Room.
Registration is at 12
Noon, followed by: 12:30 p.m. lunch and
keynote speech by Matthew Kahn, Professor at the UCLA Institute of the Environment, the Department of Economics, and the Department of Public Policy; 2:00
p.m. discussion, Climate Change and the
Housing Market, moderated by Stephen Mullin, President and Principal of ESI, with panelists Douglas
Noonan, Associate Professor and Director of Research, Indiana University Public Policy Institute; Richardson
Dilworth, Associate Professor and Director, Drexel University Center for Public Policy; and Sarah
Wu, Policy and Outreach Manager, Philadelphia Mayor's Office of Sustainability; 3:30
p.m. discussion, Sustainability and Urban
Transportation, moderated by Matthew Freedman, Associate Professor, Drexel School of Economics, with panelists Katherine
Gajewski, Director, Philadelphia Mayor's Office of Sustainability; Byron
Comati, Director of Strategic Planning, SEPTA; and Richard
Voith, President and Principal of ESI; and 5:00
For more information or to RSVP, please go to bit.ly/1cBml12.
Center City District Sips Returns in June
Center City District Sips begins Wednesday, June 3, and continues through September 2, at more than 80 official participating bars and restaurants in Center City. From 5:00 p.m. to 7:00 p.m. each Wednesday, participating establishments will offer $5 cocktails, $4 wine, $3 beers and half-priced appetizers.
This year Rosa Blanca caf� in Dilworth
Park will join in the festivities, offering outdoor seating and views of the Benjamin Franklin Parkway, the 11,160-square-foot fountain, grassy lawn, trees and flowers! Center City District Sips is sponsored by 2
Gingers Irish Whiskey.
The official Center City District
Sips Kick-Off Party will take place one week before the start of Sips, on Wednesday,
May 27, 5:00 p.m. to 7:00 p.m., at Marathon
Grill, 1818 Market Street,
featuring live entertainment, sampling and giveaways from the 2
For complete information and a list of participating
bars and restaurants, please go to centercityphila.org/life/Sips.php.
Learn How You Can Support the Rail Park
On Thursday, June 11, from 5:30
p.m. to 7:30 p.m., at the Ritz-Carlton Philadelphia,
10 Avenue of the Arts, Gilbane Building Company will host a fundraiser to support the creation of a park along the SEPTA- owned portion of the elevated Reading
Viaduct. Learn how your tax-deductible contributions can support the construction and maintenance of Phase 1 of the park.
Guest speakers will be Councilman Mark
Squilla; Paul R. Levy, President and CEO, Center City District; and Michael
Garden, board member of Friends of the Rail Park.
Hors d�oeuvres and cocktails will be served.
To RSVP, please go to svy.mk/1IG5hU6.