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Originally Posted by summersm343

Tower Place is the old State Office building at Broad and Spring Garden that Blatstein redeveloped into apartments a few years back.

The market is not seeing an oversupply - we're not even close. That's the typical negadelphian, fear we're not good enough attitude coming out in those articles. Philadelphia is a generally underserved apartment market for a city it's size.

The current vacancy rate in Philadelphia is about 3.5%. We could have another 10 apartments buildings built with zero occupancy/leases and our vacancy rate would still only be about 4-5%. That is EXTREMELY good for a major city. Most "fast growing" markets like Atlanta, Miami, Houston, Dallas, etc. have ~90-92% apartment occupancy rates currently. Philadelphia is sitting around 96%. The majority of new buildings have been meeting their lease up numbers. Mack-Cali Realty group backing out of 709 Chestnut has little to do with the market. I suspect they weren't able to get financing and get things going, so instead of looking like idiots, they tried to blame the "market." Basically what we're seeing is financing tightening up across the country - this isn't something unique to Philadelphia right now.

Philadelphia is growing in jobs, and the market is simply keeping up with that pace. Apartment development is not outpacing job growth. This is indeed a slow growth market however. A city of our size should be growing faster. I don't buy into the doom-and-gloom attitude of Paul Levy and the Center City district that if we don't grow jobs faster and build a better school district, that our city will fall into disrepair again.

Now, I do believe we need a better business tax structure to draw in and grow more jobs in the city, so we can have a faster growth market... but I don't think they city is going to start losing again. The market across the country is shifting back to a urban lifestyle. These are preference of life changes we are seeing which is driving booms in cities across the country. It's a more European way of thinking and living. A better school system could of course be a positive as well, but this isn't a make or break. Cities like LA, San Francisco and NYC have weak school systems, but still draw in a lot of people. Where these cities lack in public schools, they excel in private schools.

On top of there still being a demand for apartments, there is a hot market for condos and townhomes right now in the city. There is also a shortage and high demand for office space, and hotel rooms in the city.

Its all good news from my perspective and I tend not to believe the agenda driven negative predictions of Levy and CCD. I have read other stories saying that too much of the new product is aimed at the upper end but that is probably the case in most cities with high construction costs. Perhaps less applicable in southern cities with cheap land and labor.