Philly Setting Itself Up For an Apartment Crash?

[thesomersteam]

And again, that is a good thing for consumers and the way the market is supposed to work.

Agreed.

[ArcticSplash]

And again, that is a good thing for consumers and the way the market is supposed to work.

Because our real estate markets work perfectly without any perverse incentives that bring costs out of line with supporting incomes?


Not to side track, but after stumbling on this subdivision when looking for something, I couldn't help but notice this "Vista Del Housing Crash". Also includes marinas and boat launches.

[raider.adam]

Because our real estate markets work perfectly without any perverse incentives that bring costs out of line with supporting incomes?

What is the perverse incentive taking place? Again, I'm not really following your point in all of this. The only conclusion I am reaching is that you want City Hall to block development if they think there are too many units on the market (based on whatever crazy criteria would be used to determine that) to protect the rental rates of landlords.

[Naveen]

That doesn't change the fact that you can't walk out your door to any kind of neighborhood businesses except Delilah's.

Yes, I know, I'm beating a dead horse. But...further proof that the above is out-dated thinking. This neighborhood is only getting better.

Huge New Penn Herb Flagship Coming to 2nd and Spring Garden | NakedPhilly

The DRWC is wrong to stifle growth at this gateway intersection.

[ArcticSplash]

What is the perverse incentive taking place? Again, I'm not really following your point in all of this. The only conclusion I am reaching is that you want City Hall to block development if they think there are too many units on the market (based on whatever crazy criteria would be used to determine that) to protect the rental rates of landlords.

Where did I say I wanted City Hall to do anything?

I made no such request of City Hall.

[Jelly Roll]

Where did I say I wanted City Hall to do anything?

I made no such request of City Hall.

I have a question for you. Do you know that Pearl apartments and PMC group are two of the major groups behind this apartment expansion and they both already have thousands of units in the city? While, Buck Company is from Chicago the vast majority of the groups building right now have sizable apartment portfolios in Philadelphia. I really doubt that they would be ignorant to the current demand in the market and I do not think that 2,000-4,000 new units to be absorbed over a two year period is that big of a deal.

[raider.adam]

Where did I say I wanted City Hall to do anything?

I made no such request of City Hall.

I'm still missing what all your point is. You seem to be against all the units coming online and saying there are perverse incentives and that this is going to all crash and ruin people but before it crashes it is going to ruin existing landlords, but also don't think anything should be done about it.

I guess I am just confused on what you are trying to communicate.

[billy ross]

It's hit me that not every proposal will get built. If I had a dollar for every apartment building proposed to be built in Philly which didn't get built... The new zoning code may change things, with a quicker turnaround time due to more construction being by right and thus less time wasted waiting for approvals, but the way things used to work is that as the economy heated up people came out of the woodwork with increasingly fanciful proposals, most of which didn't deserve to be taken seriously because the people making the proposals had very thin track records - see the ACC for an example. Are some of these proposals the same site/'developer' as the supposed Philly World Trade Center? I think that was supposed to go right where these proposals are supposed to go.

Because our real estate markets work perfectly without any perverse incentives that bring costs out of line with supporting incomes?


Not to side track, but after stumbling on this subdivision when looking for something, I couldn't help but notice this "Vista Del Housing Crash". Also includes marinas and boat launches.

So where's the photo? I imagine in the Florida Keys, but it's not a place I know. The odd layout reminds me of the Rotunda.

Found it. Hitchcock, Texas, across the bay from Galveston. Someone there really wishes they were in the Keys.

[Jelly Roll]

It's hit me that not every proposal will get built. If I had a dollar for every apartment building proposed to be built in Philly which didn't get built... The new zoning code may change things, with a quicker turnaround time due to more construction being by right and thus less time wasted waiting for approvals, but the way things used to work is that as the economy heated up people came out of the woodwork with increasingly fanciful proposals, most of which didn't deserve to be taken seriously because the people making the proposals had very thin track records - see the ACC for an example. Are some of these proposals the same site/'developer' as the supposed Philly World Trade Center? I think that was supposed to go right where these proposals are supposed to go.

It is a relatively safe bet that at least 2000 new units will be coming online based off of what is already under construction. It is the units on the waterfront that I would be suspect of getting built.

[billy ross]

It is a relatively safe bet that at least 2000 new units will be coming online based off of what is already under construction. It is the units on the waterfront that I would be suspect of getting built.

What's the present stock of housing units in the Center City area? Maybe 50,000 (I infer this from a population of 100,000 and 2 per household)? If 1,000 new units come on line this year, and another 1,000 next year, that'd be a 2% growth rate, not including shrinkage due to demolitions. I don't think that a 2% growth rate is a torrid rate. The demand in Center City is super hot, and it's feeding upon itself as it increasingly leaves suburban areas and their offerings in the dust - Cherry Hill and King of Prussia aren't particularly hip right now, while CC is. The more that CC has to offer, the more people will want to live there and in its immediate surroundings. We are witnessing a positive feedback loop, where more people and more money beget more and better offerings, which then beget even more people and more money. Much of this energy is being sucked from the suburbs as their restaurants and bars and socialization locales, for example, just can't keep up and increasingly fall further behind the cutting edge stuff in CC and adjacent districts. Note that the burbs don't have a version of Steven Starr or Jose Garces, or 13th Street, or Northern Liberties, or the odd nexus of fancy restaurants at Broad and Green, where I was last night (at Alla Spina). People that want culture outside of their homes need to be accessible to Center City, and I think this is driving what's going on. It's Ed Rendell's 'tourist economy' taking on a life of its own. At the time noone understood that it would bring us here, but if you build a place that people really want to go to, it really helps the local housing market.

[Bleeper]

By that logic we should vacate the entire rest of the city (and suburbs while we're at it) in favor of shiny towers in Center City. Adding population - life - to Center City and its surroundings is nothing but good for Center City, even if the new population isn't ideally situated or in buildings which are works of art. It's the ensemble that is important, moreso than the individual pieces.

Though imo the city leaders should do whatever they can to try to steer developers to 2 areas.


1. Crucial economic areas where development and quality of life improvements are desperately needed.e.g. Market East/Convention Center.

2.Attractive Areas of prominence and sellability. e.g. Parkway .


Instead of spending a Billion dollars gentrifying Northern Lib, spend that Billion dollars gentrifying Market East first.Yes its alot more red tape to cut through but you need to get that area fixed. This is where all development focus should be and this is where Philadelphia has failed for the past 50 years.

Instead of the city sitting back cluelessly and watching a developer erect a half-built public housing looking project(Waterfront Square) someone in the city should have worked with the developer to acquire property on the Parkway to build midrise towers for 1,500 residences. Waterfront Square does virtually nothing for Philadlephia in comparison to building up the Parkway with mixed use development.


Realizing the Parkways, and Market Easts potential is exponetially more important to the city than Northern Liberties and Waterfront Square. NL and Waterfront square should have been at the bottom of the list, eventual infill.

[thesomersteam]

Though imo the city leaders should do whatever they can to try to steer developers to 2 areas.


1. Crucial economic areas where development and quality of life improvements are desperately needed.e.g. Market East/Convention Center.

2.Attractive Areas of prominence and sellability. e.g. Parkway .


Instead of spending a Billion dollars gentrifying Northern Lib, spend that Billion dollars gentrifying Market East first.Yes its alot more red tape to cut through but you need to get that area fixed. This is where all development focus should be and this is where Philadelphia has failed for the past 50 years.

Instead of the city sitting back cluelessly and watching a developer erect a half-built public housing looking project(Waterfront Square) someone in the city should have worked with the developer to acquire property on the Parkway to build midrise towers for 1,500 residences. Waterfront Square does virtually nothing for Philadlephia in comparison to building up the Parkway with mixed use development.


Realizing the Parkways, and Market Easts potential is exponetially more important to the city than Northern Liberties and Waterfront Square. NL and Waterfront square should have been at the bottom of the list, eventual infill.

You make some great points in that it would be super if Market East improved, but at the end of the day, development is done by private investors where the City is not involved. There is more development in certain areas of the City like Northern Liberties because a developer/real estate investor can buy land and build. There is very little land in the Market East section for any development to happen other than what I saw the other day across from the Convention Center where a new building will be erected.

And not for nothing, the more the City gets involved with development, the worse it will be. They do seem to do well steering a developer towards a project from time to time but I do not think City funds nor the City should be involved with Real Estate nor develpment. Their track record is not that great.

[raider.adam]

You make some great points...

No he didn't.

[phoenix]

Exactly
works for me...