On South 12th Street next to the historic Camac Baths building, a developer recently received a permit to build a tower with 448 dwellings. On 22nd Street near Market Street, another builder wants to put up 341 apartment homes over a Trader Joe’s parking lot.
Others have proposed 462 units of housing on Delaware Avenue near Poplar Street, 181 units on Callowhill Street, and 352 units in the stately buildings of the former Germantown High School complex.
Those projects represent just a fraction of the thousands of apartments and condos under development as businesses in Philadelphia resume operation after the sudden halt prompted by the coronavirus pandemic.
As of late July, the city’s Zoning Board of Appeals faced a backlog of variance applications for buildings that together would add more than 2,400 housing units, according to city data. And there are many other developments in the works that do not require zoning variances.
If they are built as planned, those large multi-family projects would help meet a strong demand for market-rate housing, which has been climbing steadily in Philadelphia since it bottomed out in April during the coronavirus lockdown.
Efforts to create and sustain affordable housing also stand to benefit as some developers take advantage of the city’s mixed-income housing bonus. Under legislation City Council passed in 2018, they can request to build more units than zoning rules would otherwise allow in exchange for paying into the Housing Trust Fund or including some affordable units.
Developers of 26 proposed market-rate projects have applied to use the bonus, in addition to 16 whose applications were previously approved. If the newly proposed homes are built as planned, builders would pay a combined $9.4 million into the trust fund and create nine units designated as affordable.
The apparent surge in residential construction is spurred in large part by coming changes in the tax abatement for new construction. Builders are trying to obtain permits before January, when the tax credit will become less valuable. But it’s also arguably a vote of confidence in the city’s long-term attractiveness as a relatively affordable place to live and work, and a rejection of fears about dense urban living.
“There’s been such talk of, ‘Oh, people are going to move to suburbs and places where they have more space, and people aren’t going to want to live in the city anymore because they’re not going to have be in their Center City office.’ This list is just showing otherwise,” said Kyle McShane, a real estate agent at Agent PHL who blogs about residential development in Philadelphia. “People are still going to have a desire for urban living. They will want to be able to walk to restaurants and other entertainment and be able to walk to work when that’s opened up again.”
“This huge pipeline of projects going to the ZBA is showing that people who are putting their money on the line for these projects feel the same way,” he said.