Office Sector News
Cushman & Wakefield: CBD Office Space 91.3% Occupied
The overall occupancy rate for the Philadelphia central business district (CBD) increased to 91.3% in the third quarter of 2015, up from 88.4% in the second quarter, with an average asking rent of $27.77 per square foot (SF), according to Cushman & Wakefield’s Marketbeat Office Snapshot Q3 2015, Philadelphia CBD. The primary reason for the increase was the withdrawal from the market of the 607,000-SF One Franklin Plaza building. PMC Property Group purchased the building for $43 million and is renovating approximately 66% of the space as apartments.
The largest transaction was the $58 million sale of the Public Ledger Building by LNR Partners to Carlyle Development Group.
In suburban Philadelphia, the occupancy rate was 85% in the third quarter, with an average asking rent of $24.29, the report noted.
To read the report, please go to bit.ly/1XadFoe [PDF].
Residential Market News
Regional House Prices Flat; City’s on the Rise
House prices in the suburbs remained flat as Philadelphia-region home values increased a negligible 0.3% during the third quarter of 2015, slowing from the previous quarter’s 5.8% increase, according to Kevin C. Gillen, Senior Research Fellow with the Lindy Institute for Urban Innovation at Drexel University, in a report released on November 24.
House prices in the city, however, continued to appreciate by 1.3% during the quarter. Before surpassing the suburban index in mid-2014, the city’s housing index had lagged behind the suburban since 1984, the report noted.
There were 263 sales of $1.0 million dollars or more in the third quarter, up from 189 in the previous quarter and breaking the all-time historic record of 240 $1.0 million-plus sales set in 2008.
To read the report, please go to bit.ly/1GhXPt6.
‘Topping Off’ Rodin Square
The developers of Rodin Square, the 10-story, $160 million apartment- and-retail project at 501 North 21st Street, marked their progress with a “topping-off” ceremony on November 24, the Philadelphia Business Journal reported.
Philadelphia's Rodin Group and Washington-based Dalian Development are building 293 rental units, a 500-vehicle parking garage, 35,000-square-foot rooftop sky park, and 85,000 square feet of retail that will include a 55,000-square-foot Whole Foods.
The first rental units are expected to be completed by late summer 2016 and the Whole Foods is scheduled to open in the early fall. To read the article, please go to bit.ly/1XrpIZ9.
Pearl Properties to Develop Hotel on Avenue of the Arts
Choice Hotels International, Inc. on November 18 announced it has signed an agreement with Pearl Properties to develop a new Cambria hotel & suites at 219-225 South Broad Street (northeast corner of Broad and Locust Streets), expected to open in 2017. The hotel will be operated by Concord Hospitality Enterprises Company.
Designed for business travel and leisure, Cambria hotels feature a large lobby, oversized rooms, and the latest technology, the press release noted. The hotel will have an upscale restaurant on the ground floor. To read the press release, please go to prn.to/1kTZnr0.
Groundbreaking Set for 1213 Walnut Street
The Goldenberg Group and Hines on Tuesday, December 8, will break ground on their 1213 Walnut Street, a 26-story, multi-family high-rise at 12th and Walnut Streets, the companies announced.
The site is currently a parking lot. The building will include 322 rental units and 7,300 square feet of retail. The development is expected to be completed in late 2017.
For background on the project, please see the Philadelphia Business Journal’s article, bit.ly/1zNZiXO, which notes the mixed-use development could be an anchor east of Broad Street.
New Concept for Former Destination Maternity Warehouse
Alliance Partners HSP of Bryn Mawr, owner of the former Destination Maternity warehouse at Fifth and Spring Garden Streets in Northern Liberties, is changing the concept for developing the 220,000-square-foot property, the Philadelphia Business Journal reported on November 25.
The original plan called for creative-class industrial office space to be known as SoNo, but the company is now looking at residential, retail and office, and expects to have a new proposal for the site ready by spring 2016.
To read the article, please go to bit.ly/1QLa9fP.
Developer Will Preserve Rittenhouse Coffee Shop
Southern Land Company, developer of a proposed retail, residential, and office tower at 1911 Walnut Street, has withdrawn an application to raze the Rittenhouse Coffee Shop, built in 1855 at 1904 Sansom Street, and will recast its development plan to preserve that building, The Philadelphia Inquirer reported on November 20.
The company is still seeking permission to demolish the Warwick apartment building, built in 1903, and the Oliver Bair funeral home, from 1910.
To read the article, please go to bit.ly/1If3mZf.
Eds and Meds News
Thomas Jefferson University to Offer Expanded Program
The Sidney Kimmel Medical College at Thomas Jefferson University on November 24 entered into an agreement with Atlantic Health System to establish a branch campus at hospitals in Morristown and Summit, New Jersey, so that Jefferson medical students will have the opportunity to complete their third and fourth years of clinical training at the new North Jersey campus beginning in July 2018.
Those locations will provide a program in which students throughout their clinical training follow a panel of patients, which reinforces continuity of care and patient-centered treatment.
To read the article, please go to bit.ly/1Ndk0o0.
Manufacturing Economy Sluggish, Service Economy Slightly Stronger
Manufacturing conditions in the region showed slight improvement this month, according to firms responding to the November Manufacturing Business Outlook Survey, but remained weaker than the service economy, according to the Nonmanufacturing Business Outlook Survey. The Federal Reserve Bank of Philadelphia conducts both monthly surveys.
In manufacturing, new orders were up for 25.8%, down for 29.5%, and remained the same for 42.9%. In nonmanufacturing, new orders were up for one-third (33.3%) of the responding firms, down for 17.5%, and remained the same for 36.8%.
In manufacturing, the number of full-time employees increased for 13.6%, fell for 11.0%, and remained the same for three-fourths (75.4%). In the service sector, 21.1% of the firms reported an expanded number of employees, 10.5% indicated fewer, and two-thirds (66.7%) reported the same number.
Looking ahead six months, both sectors of the economy had similar outlooks, with 50.4% of the manufacturers and 50.9% of the service providers expecting conditions to improve, while 7.0 % from each sector anticipated a downturn; and 30.9% and 36.8%, respectively, foresaw no change.
For the manufacturing report, please go to bit.ly/1jiwXFh. For the nonmanufacturing report, please go to bit.ly/1lIcT11.
One Liberty Observation Deck Opens
The new One Liberty Observation Deck on the 57th floor of One Liberty Place opened Saturday, offering 360-degree views of the city and beyond, with visibility on clear days of 40 miles or more, 6abc reported. The deck is reached via a 75-second ride in an express elevator.
Six multilingual interactive touch screen kiosks allow you to zoom in and out of neighborhoods, and find landmarks and other points of interest. Tickets range from $14 to $33.
To read the 6abc article, please go to 6abc.cm/1I4OtTQ.
For information about hours and tickets, please go to phillyfromthetop.com.
Philadelphia to Host International Soccer Tourney in 2016
Philadelphia was chosen as one of 10 host cities in the U.S. for the 2016 Copa América Centenario soccer tournament June 3 to June 26, featuring the top national teams from across North, Central and South America, Philly.com reported on November 19. Games will be played at Lincoln Financial Field.
The other host cities are Boston, Chicago, Houston, Los Angeles, New York, Orlando, Phoenix, San Francisco and Seattle.
To read the article, please go to bit.ly/1PPZlLQ.
BIO Convention to Return in 2019
The Biotechnology Industry Organization (BIO) annual international convention, held in Philadelphia earlier this year, will return to the Pennsylvania Convention Center in June 2019, the Philadelphia Business Journal reported on November 25.
The city’s second-largest convention, BIO’s was attended by more than 15,000 people and generated more than $43.3 million in economic impact. The 2019 convention is expected to fill more than 27,000 hotel room nights and generate more than $41 million in economic impact.
To read the article, please go to bit.ly/1Ib8RIk.
Three New Restaurants for SugarHouse Casino
SugarHouse Casino on the Delaware River, undergoing a $164 million expansion, is planning a soft opening at the end of December for the new addition, and has announced three new restaurants for its food-and-beverage area, The Marketplace, the Philadelphia Business Journal reported on November 24.
Local companies Geno's Steaks, Saxbys and Tacconelli's Pizza will join the previously announced high-end steakhouse Hugo's Frog Bar & Chop Shop and open in January. A cigar bar and an Asian noodle restaurant will follow in late spring.
To read the article, please go to bit.ly/1lHPQn0.
In other SugarHouse news, revenue increased slightly (+3.7%) in October, according to the Pennsylvania Gaming Control Board.
In October, the casino took in $21,545,646, compared to $20,767,026 in September. The Commonwealth’s share of taxes in October was $5,731,053, compared to September’s $5,347,174. The City of Philadelphia collected $714,635, compared to $673,333 in September.
To see all casino revenues, please go to bit.ly/1I0aqlt.
Council Committee Approves Casino Zoning
After a six-hour hearing, the City Council Rules Committee on November 16 unanimously approved Bill #150767, which would create the changes in the Special Purpose Entertainment District (SP-ENT) zoning regulations needed to build the $450 million Live! Hotel and Casino at 900 Packer Avenue, The Philadelphia Inquirer reported. The bill now goes to the full Council.
Stadium Casino L.L.C., a partnership between the Cordish Companies of Baltimore and Greenwood Gaming & Entertainment, also has won approval from the Philadelphia City Planning Commission and five community organizations in neighborhoods near the site, the article noted.
To read the article, please go to bit.ly/1MkQ0JB. To read Bill #150767, please go to bit.ly/1OKQkVh.
Arts and Culture News
Nancy Gilboy Stepping Down at CDI
Nancy Gilboy, President and CEO of Citizen Diplomacy International of Philadelphia (CDI), formerly International Visitors Council of Philadelphia, will resign on December 31, due to health reasons, the Board of Directors announced on November 17.
Gilboy will remain involved as President Emeritus.
During her 25-year tenure, the CDI assumed responsibility for Philadelphia’s Sister Cities Program and initiated a partnership with Drexel University to create the first Sister City Scholarship Program in the U.S., which has expanded to 10 colleges and universities.
To read the Board’s announcement, please go to bit.ly/1OkUjqH.
DRPA Approves Funds for Franklin Square Station Renovation
The board of the Delaware River Port Authority (DRPA) approved a capital budget totaling $166.5 million for 2016 and $728 million over five years, a 13% increase over the 2015 capital budget, with $28.3 million over five years allocated to reopen the PATCO Franklin Square Station, PlanPhilly reported on November 18.
The 2016 budget includes $500,000 to hire a design firm to draft blueprints for the station.
A 2015 study calculated the cost to renovate and open the station at $18.4 million, but that grew to $28 million because DRPA expanded the construction scope to include another entrance on the south side of Race and a tunnel to the platform, the article noted. To read the article, please go to bit.ly/1MpDKaH.
Spirit Airlines to Add Service to Los Angeles
Beginning April 14, Spirit Airlines will add new daily nonstop service to Los Angeles International Airport (LAX) from Philadelphia International Airport (PHL), The Philadelphia Inquirer reported.
Spirit offers lower base fares but adds charges for a carry-on bag and advance seat assignment, among other services, the article noted. To read the article, please go to bit.ly/1lIecNd.
Parking App from PPA Now Available
The Philadelphia Parking Authority on November 18 announced the launch of its meterUP parking app, which went live the following day in Center City and will expand to the entire city in approximately six months.
Once the app is downloaded, meterUP allows you to pay for parking from any iOS or Android smartphone, though you also can pay for parking via text using a flip phone.
The new app sends an alert seven minutes before your parking session expires and allows you to extend the time via your phone. The app has a variety of other conveniences. To learn more about meterUP, please go to bit.ly/1X1iWyj.
Report: Lack of Transit Investment Threatens Economic Growth
The metropolitan areas of Atlanta, Boston, Chicago, Cleveland, New York, Philadelphia, Pittsburgh, San Francisco/Oakland and Washington, D.C., make up only 2% of the U.S. land area, but contain more than one-fifth of the U.S. population and jobs and account for 27% of U.S. economic activity, according to a recently released report from the Regional Plan Association.
The collective state of good repair backlog for the transit agencies in these nine regions is $102 billion and the annual normal replacement need is $13 billion. The report suggests that if current trends continue, the overall mobility within these regions will be greatly reduced and their viability as engines of national economic growth will be challenged.
To read the report, The Need for Greater Federal Investment in Metropolitan Rail, please go to bit.ly/1MMxcA5 [PDF].
Bill Would Allow SEPTA’s Digital Advertising
On November 19, Councilman Mark Squilla, on behalf of Council President Darrell L. Clarke, introduced Bill #150900 that would allow SEPTA to build and maintain digital outdoor advertising signs at 11 transit entrances, including the southwest corner of 15th Street and John F. Kennedy Boulevard.
To read the bill, please go to bit.ly/1lOZyUo.
Parks and Open Space News
Made in Philadelphia Holiday Market at Dilworth Park
With more than two dozen specialty vendors, the new Made in Philadelphia Holiday Market at Dilworth Park adds new craft and gift shopping opportunities through Sunday, December 27, on the southern end of the park, complementing the Rothman Institute Ice Rink on the north.
Made in Philadelphia Holiday Market hours are Sunday through Thursday, 11:00 a.m. to 7:00 p.m.; and Friday and Saturday, 11:00 to 8:00 p.m. On Christmas Eve, December 24, market hours will be 11:00 a.m. to 5:00 p.m., and the market will be closed on Friday, December 25. For information on all the exciting activities at Dilworth Park, please go to dilworthpark.org.
Appointments for the Kenney Administration
On November 13, Mayor-elect Jim Kenney announced four more appointments for his administration, The Philadelphia Inquirer reported. He will retain Rob Dubow as Finance Director, and current budget director Rebecca Rhynhart will be in charge of a new position overseeing procurement, information technology, and human resources. Sheila Hess, director of foundation and community affairs for Independence Blue Cross, will serve as city representative, and Harold T. Epps, vice chairman of PRWT Services, will be commerce director, bit.ly/1OqCx3y.
Kenney on November 18 appointed Nolan Atkinson Jr., a partner at Duane Morris L.L.P., to be the city's first chief diversity and inclusion officer, The Philadelphia Inquirer reported. Kenney also named Ellen Mattleman Kaplan, a former Committee of Seventy vice president, as chief integrity officer. Inspector General Amy Kurland will continue in her job, bit.ly/1SZ07pO.
On November 24, The Philadelphia Inquirer reported Clarena Tolson, current Revenue Commissioner, will serve as deputy managing director for infrastructure and transportation. Brian Abernathy, executive director of the Philadelphia Redevelopment Authority, will serve as first deputy managing director. Jim Engler, a Kenney campaign official, will serve as deputy mayor for policy and legislation; Richard Lazer will serve as deputy mayor for labor; and David Wilson, the Nutter administration's first deputy managing director for administration, will serve as deputy managing director for community and culture, overseeing the Departments of Parks & Recreation, Libraries, and the Office of Arts and Culture, bit.ly/1Td5UrY.
Streets Commissioner David Perri will head the Department of Licenses and Inspections, Kenney announced on November 25, bit.ly/21k0iBt.
Installation Complete of Portal Gates at City Hall
The North Portal Gate, the last of four pairs of ornamental gates for City Hall’s entrances to the courtyard, was installed on November 25.
Vitetta Architects developed construction documents from original conceptual drawings, creating gates that are more than 25 feet tall and weighing approximately 3,200 pounds. Robinson Iron Corporation fabricated the gates in partnership with the structural engineering firm Keast & Hood of Philadelphia, both of whom won competitive bids.
The Center City District managed the project on behalf of the City of Philadelphia, which contributed $1.5 million to the project, while the CCD was able to raise the remaining funds through a generous grant from the William B. Dietrich Foundation. The City will maintain the gates.
CPDC Meeting: Looking to 2016
The Central Philadelphia Development Corporation will hold its final meeting of the year on Tuesday, December 15, at 8:30 a.m., in the
Union League’s Grant Room, 140 South Broad Street.
With 2015 drawing to a close, new housing, hotels and retail are under construction across Center City, a response to the downtown's growing residential population and the number of overnight visitors. What other factors are driving this positive transformation? How strong are these trends for 2016? What are the uncertainties or risks for over-building? What could Mayor-elect Jim Kenney do that would be most helpful to sustain momentum and prompt growth in other sectors?
Speakers will be Joseph D. Pasquarella, MAI, CRE, FRICS, Senior Managing Director, Integra Realty Resources – Philadelphia; Julie Coker Graham, Executive Vice President, PHLCVB; and Steven Gartner, Executive Vice President, CBRE.
Business casual attire required; no denim please.
CPDC members are encouraged to invite both young professionals and other members of their firms to attend this meeting. Please RSVP to to Danielle Allen by December 9, email@example.com or 215.440.5543
Gallery NID Bill Scheduled for Council Vote
Bill #150374, which would establish the Gallery Neighborhood Improvement District (NID), is scheduled for a vote by City Council on Thursday, December 3.
The purpose of the NID is to provide a financial mechanism to guarantee the proposed Gallery tax increment financing district, and would designate the Gallery Neighborhood Improvement District Corporation, a Pennsylvania nonprofit corporation, as the Neighborhood Improvement District Management Association for the District.
To read the bill, please go to bit.ly/1FrqPmD.