THE FUTURE OF DOWNTOWN
• The new economic geography
• Public space is the answer
• Working together to fend off the “doom loop”
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DEPARTMENTS
A Chapter of the American Institute of Architects 1218 Arch Street, Philadelphia, PA 19107 215-569-3186, www.aiaphiladelphia.com.
The opinions expressed in this — or the representations made by advertisers, including copyrights and warranties, are not those of the editorial staff, publisher, AIA Philadelphia, or AIA Philadelphia’s Board of Directors. All rights reserved. Reproduction in part or whole without written permission is strictly prohibited.
Postmaster: send change of address to AIA Philadelphia, 1218 Arch Street, Philadelphia, PA 19107 Published JULY 2024
IN THIS ISSUE , we explore the future of America’s downtowns in a post-pandemic era.
FEATURES
Cities must move fast to take advantage of large-scale changes in the U.S.
By Bruce Katz
In the era of remote and hybrid work, thriving public spaces have the power to transform downtown
By Matt Rader and Patrick Morgan
Only a collaborative approach can save us from the “urban doom loop”
By Omar Blaik and Alex Feldman
Suggestions? Comments? Questions? Tell us what you think about the latest issue of CONTEXT magazine by emailing context@aiaphila.org. A member of the CONTEXT editorial committee will be sure to get back to you.
2024 BOARD OF DIRECTORS
Brian Smiley, AIA, CDT, LEED BD+C, President
Danielle DiLeo Kim, AIA, President-Elect
Rob Fleming, AIA, LEED AP BD+C, Past President
Robert Shuman, AIA, LEED AP, Treasurer
Fátima Olivieri-Martínez, AIA, Secretary
David Hincher, AIA, LEED BD+C, Director of Sustainability + Preservation
Phil Burkett, AIA, WELL AP, LEED AP NCARB, Director of Firm Culture + Prosperity
Kevin Malawski, AIA, LEED AP, Director of Advocacy
Erick Oskey, AIA, Director of Technology + Innovation
Ximena Valle, AIA, LEED AP, Director of Design
Fauzia Sadiq Garcia, RA, Director of Education
Timothy A. Kerner, AIA, Director of Professional Development
Michael Johns, FAIA, NOMA, LEED AP, Director of Equitable Communities
Katie Broh, AIA, Director of Strategic Engagement
Kenneth Johnson, Esq., MCP, AIA, NOMA, PhilaNOMA Representative
Danielle Fleischmann, AIA, At-Large Director
Michael Penzel, Assoc. AIA, At-Large Director
Andrew Ferrarelli, AIA, At-Large Director
Luka Lakuriqi, Assoc. AIA SEED,Director of Philadelphia Emerging Architects
Mitchell Schools, Assoc. AIA, Director of Philadelphia Emerging Architects
Scott Compton, AIA, NCARB, LEED AP, AIA PA Representative
Tya Winn, NOMA, LEED Green Associate, SEED, Director of Equity, Diversity + Inclusion and Public Member
Rebecca Johnson, Executive Director
CONTEXT EDITORIAL BOARD
CO-CHAIRS
Timothy Kerner, AIA, Terra Studio
Harris M. Steinberg, FAIA, Drexel University
Todd Woodward, AIA, SMP Architects
BOARD MEMBERS
David Brownlee, Ph.D., FSAH, University of Pennsylvania
Julie Bush, ASLA, Ground Reconsidered
Clifton Fordham, RA, Temple University
Fauzia Sadiq Garcia, RA, Temple University
Milton Lau, AIA, BLT Architects – a Perkins Eastman Studio
Jeff Pastva, AIA Scannapieco Development Corporation
Dana Rice, AIA, CICADA Architecture Planning
Eli Storch, AIA, LRK
Franca Trubiano, PhD, University of Pennsylvania
David Zaiser, AIA, HDR STAFF
Rebecca Johnson, AIA Philadelphia Executive Director
Jody Canford, Advertising Manager, jody@aiaphila.org
Lee Stabert, Managing Editor
Courtney Edwards, Marketing Consultant
Laurie Churchman, Designlore, Art Director
HARRIS M. STEINBERG, FAIA
Lindy Institute for Urban Innovation
Drexel University
CONTEXT Editor
DAVID ZAISER,
Project Principal at HDR
CONTEXT Editor
EDITORS’ LETTER
DOWNTOWN: NO FINER PLACE
The vision of a vibrant downtown is no better described than in Petula Clark’s 1964 hit, “Downtown,” penned by English songwriter Tony Hatch.
The lights are much brighter there
You can forget all your troubles, forget all your cares
So go downtown, things’ll be great when you’re Downtown, no finer place for sure Downtown, everything’s waiting for you
Though 60 years old, “Downtown” still captures the emotion that many of us associate with downtowns. That feeling is no accident. Urban leaders have worked diligently to make our downtowns attract and engage us. The popularity of Philadelphia’s Center City among young adults and retirees alike suggested that they were on the right track, until a global pandemic changed everything.
This issue of CONTEXT is devoted to reconsidering how we plan our downtowns in a post-pandemic world. Downtowns are where we all came together, but when the pandemic kept us apart, the “bustle” that was the soul of so many urban ideals disappeared overnight. Urban planners like Joey Scanga were adrift, as he explains, “for the first time in my career, I feel less confident predicting the future of cities.” (see Commentary, page 24).
We hear you, Joey. Images from the pandemic years — struggling businesses, quiet lunch times in Rittenhouse Square, empty SEPTA buses — still haunt us today. It’s easy to fear for the future of our downtown, but there are reasons to be encouraged, too. New research-centric development in our downtown — not in the suburbs — is a sign that something new is going on here. That “something” according to Bruce Katz in the feature article, “Downtowns and the New Economic Geography,” is an economic shift that could help to diversify our downtowns and strengthen our economy. (see page 12).
Meanwhile, Omar Blaik and Alex Feldman suggest that our downtowns relied too heavily on the 9-5 office worker. They argue that a more holistic perspective, coupled with additional investment from higher education, healthcare and governmental institutions could attract a more robust — and diverse — constituency to our downtown. (see page 20).
Perhaps the pandemic was an opportunity to rethink our downtowns as more dynamic mixed-use destinations filled with vibrant public spaces? After all, parks and plazas proved vital as social relief valves during the shutdown. Patrick Morgan and Matthew Rader adopt that thesis in their article, “If You Build It, They Will Come” (page 16). Philadelphia has a history of wonderful public spaces. How can new types of shared amenities like Dilworth Park transform the urban landscape? And what role does natural beauty play in our social infrastructure?
There are more questions now than answers, but there is plenty to be excited about. Downtown, there’s no finer place for sure. We hope you enjoy this issue.
COMMUNITY
Dear Friends and Colleagues,
Greetings as we welcome the summer of 2024. This year has been marked by significant developments and milestones for both AIA Philadelphia and DesignPhiladelphia. The progression over the last six months has been swift, underscoring the dynamic changes and adaptations within our community and organization.
A strategic redirection is currently underway at AIA Philadelphia, encompassing a comprehensive planning process aimed at enhancing our operational structure and engagement strategies. A notable addition to our array of offerings is the introduction of “Architecture on Tap,” a networking initiative designed to foster connections and dialogue among our members. This program aligns with broader efforts observed across various AIA chapters nationwide, addressing the need for increased social interaction and professional networking in the aftermath of pandemic-induced isolation.
This strategic planning process is centered around the ways that AIA Philadelphia can help our members thrive. We are exploring programs with colleagues across the AIA network that can bring the best resources and information to our community here in Philadelphia.
Furthermore, our annual Home Tours program is slated
to return this fall, entering its second year with renewed enthusiasm and anticipation. This initiative remains a pivotal aspect of our engagement with the public about the value of hiring an architect, especially in residential projects.
Expanding upon the momentum of our prior endeavor with ULI Philadelphia, this year our Urban Resilience Forum will be produced in collaboration with Green Building United and the Preservation Alliance. This expanded partnership aims to dissect and address the concept of resilience at multiple scales — from individual homes to neighborhoods, and extending to citywide and regional strategies.
Our calendar is brimming with activities and initiatives scheduled for fall, and I encourage all members to earmark these events. And in the midst of preparation for a bustling season, I also wish to emphasize the importance of taking moments to relax and rejuvenate during the summer months ahead.
Cheers,
Rebecca E. Johnson, Executive Director, AIA Philadelphia
Join us for our new socials series:
Architecture on Tap is brought to you by AIA Philadelphia. Each month we will visit a local brewery in the region. Join us for an evening of cold drinks, small bites, and great conversation with your colleagues about architecture and design. Cheers!
CONFIRMED DATES *:
• Thurs, June 20 – Triple Bottom
• Thurs, July 18 – Attic Brewing
• Thurs, August 15 – Love City
Making Design Accessible to Everyone from Everywhere
DesignPhiladelphia, formerly the Center for Architecture and Design, is expanding its Design Education programming. Designers, college students, and DesignPhiladelphia staff are engaging with thousands of students in Philadelphia, both in and outside of the classroom.
In addition to the K-12 focus of the Design Education programs, DesignPhiladelphia has been growing its offerings for JADE (Justice Alliance in Design Education) for college students, faculty and administrators across the Commonwealth. Those offerings include innovative design studio approaches, an annual symposium for faculty and students, and the 2024 Inaugural JADE Fellows. The JADE
2024 AIA Philadelphia Design Awards Celebration
Fellowship program is run by Rebecca Johnson and Michael Spain and includes one architecture student from each of the five architecture departments in Philadelphia.
In addition to always needing volunteers for the programs and workshops, DesignPhiladelphia also needs financial support. Reach out to see how you can get involved.
SAVE THE DATE for our first ever annual DESIGNING FUTURES BREAKFAST on Thursday September 12, 2024 at the Center for DesignPhiladelphia. More information is available at www.designphiladelphia.org.
For more information, visit www.aiaphiladelphia.org
COMMUNITY
Remembering Emanuel Kelly
His colleague George Claflen shares reflections on one of the city’s most beloved and connected architects
In January 2024, renowned local architect Emanuel Kelly, FAIA passed away suddenly from pulmonary embolism. A principal in Kelly Maiello, one of the city’s first Black-owned architectural firms, he was also the first Black president of AIA Philadelphia and the force behind many important, acclaimed projects.
But he was perhaps most admired as a colleague and a friend. To honor Kelly, CONTEXT spoke with George Claflen, a longtime co-worker of his in the Architecture Department at Temple University. Claflen refers to him as “Kelly,” which was what he preferred.
You first met Emanuel Kelly in 1976 when he was hired at Temple. Do you remember anything about your first impression and what he was like as a young man in that era? We were both young men (laughs). He always spoke honestly and directly, and he listened. He was like that in 1976 and he was like that right up until the end.
It was such a treasure because there are so many people that you interact with and have to work with who don’t listen. They ignore you or they just want to talk about themselves. Kelly interacted. You had a conversation with Kelly. And if he disagreed, you could have a fierce argument, but it wasn’t personal.
A lot of people who pick up CONTEXT are going to be familiar with Kelly, but for people who aren’t, why is he important to the city of Philadelphia? How did his projects shape the built environment?
There were two very large projects: renovations of City Hall and the design of the Convention Center, and then there was a very large site-planning challenge at Tasker Homes, a public housing project.
But probably his most recognizable and most prominent project was The President’s House on
Independence Mall. Some people hate it. Some people love it. But it could not have been built without Kelly. It was an extremely fraught process that he guided his team through — fraught because there were many citizens of Philadelphia who thought that it didn’t go far enough or that it should express further the dilemma of slavery in Philadelphia.
Kelly was the honest broker among many different groups who felt different things about this. He brought the project off, and it was a very, very challenging project.
Independence Hall and the Liberty Bell are technically owned by the City of Philadelphia. They’re on loan, you might say, to the National Park Service. This was the City of Philadelphia asserting itself on the doorstep of the Liberty Bell. The Park Service wasn’t too happy about it at the beginning, but with Kelly’s professionalism, the process that evolved was a very serious one that I think resulted in the best that was possible.
City Hall and the Convention Center came about in part because Kelly Maiello Architects had the advantage of being an MBE [minority business enterprise]. And that certainly helped them get a foot in the door with the City, but that only gets your foot in the door. And what Kelly did from the beginning was he said, “We’re not going to, as
a firm, rubber stamp or just collect some money on the side. We’re going to do important work and we want a significant piece of the projects that we’re actually going to be responsible for.” He was adamant about that. And he became, therefore, a very beloved and often selected architect for public projects.
Can you talk about his role as a Black architect in a field that is generally pretty white? It sounds like he became known as someone who could go between worlds.
That’s absolutely right. I highly recommend a set of oral history videos that the University City Historical Society did with Kelly. I learned things about my good friend that I did not know.
One of the things that was remarkable was the love and energy expended by his mother to give him the best chance in life. She worked as a domestic. I think she worked for an architect for a while and she thought, “My son might be interested in this.” And through her intervention, he visited with the architect and was invited to work on some construction tasks. He thought, “This is something I could do.”
And of course he became an architect through a very, very demanding process. He was working full time, some of it in construction. He worked for Turner, which is a very large international construction company — he worked on the big apartment house on the southwest corner of Rittenhouse Square, the Dorchester. He was going at night to architecture school at Drexel. At that time, Drexel’s program was exclusively at night.
He met a lot of people there and was invited to work at Mitchell Giurgola. That was a tremendous experience for him because I think he was the only African-American employee. He was very well regarded. And he also did what a smart man like him would do: He kept his eyes open and
looked around at how things were done. I think he learned a lot about how to run an architectural firm by watching what they did, how they marketed themselves, how they pursued awards and networked. That never left him.
This all came together when he went to Harvard Graduate School of Design (GSD). He became friendly with international scholars such as Alexander Tzonis and Liane Lefaivre, and worked closely with the leading African-American firm in Boston, Stull & Lee. David Lee, FAIA who had worked for David Crane’s office in Philadelphia (which was in the same building as Mitchell Giurgola) had encouraged Kelly’s application to the GSD. They remained life-long friends and colleagues. David Lee came down from Boston and spoke at the memorial service.
Kelly talked to everybody. Walking down the street with him, he knew so many people. He knew the security guards at many buildings. He knew the people at the cigar store and he knew, of course, many architects. Kelly went to everything that he was invited to.
He obviously was a mover and shaker. Can you talk about his relationship to the next generation of Philadelphia architects? Did he have a special focus on the next generation of Black architects?
There were two Temple graduate students in particular who are married to each other, Germano Botelho and Claudia Richardson. Germano is a native of Bermuda and Claudia is a native of St. Vincent and the Grenadines; they have a practice together in Bermuda now.
Germano describes the basic humanity that Kelly had. He was well known at the studio for coming in to his thesis students quite late in the day — he was at the office working and he would catch food from students because he was hungry.
He probably didn’t eat lunch because he was so busy. Of course Temple had a strict no smoking policy, but occasionally he would smoke in the studio and the students were very tolerant of that because they loved him.
He was invited by the students to speak at their graduation. He expressed the need to give back. The way he expressed it really meant something to me. He described how there are people in your life who help you that you can’t possibly repay. The only thing you can do if you really want to repay that debt is to pass it on. The world has profited enormously by people who have grasped that idea. And Kelly lived it every day.
So any final thoughts on his legacy and why Philadelphia was lucky to have him? Architecture is filled with arrogant people on the make. And Kelly certainly spent a lot of time promoting himself to achieve what he did achieve, but was, in fact, almost quiet. He always promoted himself based on quality. That was an enormous strength. You asked what the legacy will be. I worry
about that part because as I’ve gotten older, I’ve lost people. I realized that the memory of those who are gone stays strong among those who knew them well. Someday I’ll be gone and those who knew him the best will be gone. And who remembers then? That’s why we need to document more. The buildings stand. They’ll be there. But I’m hoping that some historians and architectural critics will take an interest in looking at what he did and how he did it.
This past summer, I met Kelly for lunch on Walnut Street, right opposite the office. He was a little off. He said, “Oh, well I was up in the attic of the barracks at the Navy Yard all morning and it was hot.” The waiter brought us water and he began to feel better. But here he was at 81 — he was leading this project for a minority developer at the Navy Yard — and he was saying, “I want to survey the attic myself.”
I think his legacy is safe in the current generation of people who knew him, but I guess we all have a responsibility to pass that on.
— Lee Stabert
UP CLOSE PREMA KATARI GUPTA
BY JOANN GRECO
Walking with Prema Katari Gupta towards her office at 7th and Chestnut Streets, I mention that we might just be passing the city’s filthiest alley. The newly-appointed president and CEO of the Center City District (CCD) appears to bristle.
“I don’t agree with you,” says Gupta. Ahh, here it comes: the standard operating boosterism.
“I think there are several other strong contenders,” she quips. Boom!
It’s a surprising answer — though it shouldn’t be because Gupta is a self-confessed student of trash. On a recent visit to Copenhagen with her husband, they were sitting at a restaurant in Nyhavn.
“I couldn’t stop watching someone putting a clown car’s worth of garbage in a bin along the canal,” she recalls. “Later, I Googled to see what happened from there. It turns out there are pneumatic shoots underwater that transport the trash to a central spot to be compacted.
“That’s a tremendous investment,” she continues. “Here, we have an addiction crisis, we have a gun problem. Trash has become normalized. It not seen as anyone’s responsibility.”
Lest we go down a rabbit hole of complaints, Gupta shifts gears. The sun is definitely rising in Philadelphia — and indeed in most American cities — she points out. The organization’s recent “Downtowns Rebound” report rebuts the notion that the pandemic has turned the nation’s largest urban cores into empty, gutted, dangerous, dirty wastelands. By mid-2023, for example, the city centers of all 26 cities analyzed had recovered at least two-thirds of their 2019 daily pedestrian traffic. In Philadelphia, the number was 83 percent, parsed out to residents at 126 percent of 2019 levels, visitors at 82 percent and non-resident workers at 68 percent. Weekday evening volumes rebounded to 87 percent while weekend foot traffic is at 95 percent of 2019 levels.
“I have to think that we’re all at the point in our lives where we’re craving to be outside, among people,” says Gupta on the upwardly trending numbers. She mentions our much-discussed loneliness epidemic, which has been blamed on smart phones, the pandemic, social media, online shopping, etc.
“I’m not even sure about the so-called ‘15-minute city,’” she says, referencing the urban planning paradigm in which most daily
necessities and services can be easily reached by a 15-minute walk, bike ride, or public transit ride from any location. “Do we really need more self-sorting so that we can achieve everything we need to do by staying close to home? We need public transit. We need random encounters and interactions with strangers. We need to create places that are for everyone. Look at Dilworth Park — according to cellphone data, it’s become a citywide park. That’s awesome.”
Obtaining a basic “clean and safe” level is the mantra that drives CCD, but, according to Gupta, it’s the “defensive” weaponry to erase the negativity that surrounds our cities.
“What I really want to emphasize is the ‘offense’ — the parks, the walkability, the culture, the restaurants,” she says. “The stuff that feels good.”
Those positives weren’t always so obvious to her. Gupta grew up in small-town Connecticut with their brother and Indian immigrant parents. Her father commuted to Hartford for a job in the insurance industry and the family trotted to the capital once or twice a year “to check out the Wadsworth Atheneum or the Mark Twain house,” she says. “But otherwise I didn’t spend much time in cities. When we visited my grandparents in India, I felt completely overwhelmed.”
That all changed at Bowdoin College where her studies in art history and government led to a semester abroad in Florence.
“I had a Eurail pass and all of a sudden, I could be in Prague or Paris or Amsterdam,” she recalls. “I fell completely in love with cities, and how livable and humane and joyful they could be.”
After college, she moved to New Haven for a development job at Yale University. There, her first day-to-day experiences of la vida urban nudged her into thinking that making a career out of caring for and creating better cities might be for her.
On to Philadelphia and to the University of Pennsylvania, specifically, to pursue a master’s degree in historic preservation.
“What attracted me to preservation — and it’s a thread that’s run through a lot of my work — is that older buildings are for the most part superior to what we build now,” she says. “And city planning is just a layer on top of that, leveraging those old buildings and neighborhoods and making them more livable. I’m not at all a strict preservationist.”
Armed with her preservation chops, she served stints as a scholar in residence for Urban Land Institute (where she was lead author of its book, Creating Great Town Centers and Urban Villages), real estate manager for the Philadelphia Industrial Development Corporation, director of planning and economic development for the University City District, and senior vice president at the Navy Yard.
In 2020, she joined CCD as a vice president of parks, where her purview included oversight of Dilworth, Sister Cities, Cret and John F. Collins Parks, as well as the District’s streetscape assets. In 2022, she was appointed executive director of the Central Philadelphia Development Corp., which was founded in 1956 and supports a number of initiatives including CCD, created in 1991.
It was never a foregone conclusion that Gupta would move behind the desk that Paul Levy, CCD’s founding president, occupied for 33 years but “it was always obvious that there’d be an opportunity for me,” she says. “Look, I’ve known Paul for 20 years, ever since I was a graduate student. We’re from different generations and we don’t always agree, but what he did is magical.”
The 45-year-old mother of two remembers sending Levy photos of her daughter playing with the boats in Sister Cities Park.
“WE NEED PUBLIC TRANSIT. WE NEED RANDOM ENCOUNTERS AND INTERACTIONS WITH STRANGERS. WE NEED TO CREATE PLACES THAT ARE FOR EVERYONE.”
As Gupta looks toward her own future at the helm, she’s aware of the challenges she faces. For one, there’s the sense that downtown retail is struggling. It’s not, she says, citing CCD research that puts today’s storefront occupancy at 85 percent, just four percentage points shy of pre-pandemic levels. While some legacy brands like Ann Taylor and Banana Republic have closed their west Walnut Street stores, digital native brands like Faherty and Joybird are establishing brick-and-mortar presences. And while the eastern ends of South and Chestnut Streets are in bad shape, it’s important to acknowledge their declines started years before the pandemic.
The other stumbling block is a resistance to the rise of remote and hybrid work.
“Return to office hasn’t been as strong as we’d like, but it’s been lazily framed as a power struggle between employer and employee,” says Gupta. “As someone who runs an organization, I think it’s incumbent on employers to create a value proposition for employees. Personally, I understand the value: I’ve met some of my
greatest friends through my jobs. And, professionally, I would not have the career I’ve had if I hadn’t built the relationships I did. I just think people are better off getting together in person.”
Gupta ticks off all the exciting things happening in the city, particularly in areas like West Market, the Navy Yard, the riverfronts and along Spring Garden Street.
“[I see] not gloom and doom, but more pedestrians and more vitality,” she says. “I know there are people who still feel uneasy about coming downtown, and I certainly respect that perspective, but I think they’re missing out. The data shows that there’s a disconnect between the perception and the reality — so the vibes are off. And our job is to fact-check the vibes.”
And don’t forget about the trash.
“I’m trying to retrain myself to see the graffiti and the trash, the cues that give people those bad vibes,” she adds. “We can’t get used to it.”
JoAnn Greco is a Philadelphia-based journalist who frequently writes about the built environment.
DOWNTOWNS AND THE NEW ECONOMIC GEOGRAPHY
CITIES MUST MOVE FAST TO TAKE ADVANTAGE OF LARGE-SCALE CHANGES IN THE U.S.
BY BRUCE KATZ
For 25 years, the rebound of central business districts has been a driving force in the rebirth of U.S. cities. That positive dynamic is now threatened as the rise of hybrid and remote work drives detrimental, domino-like effects on commercial real estate, small businesses, transit ridership, and municipal tax generation. In certain sectors, working from home, either part time or full time, has become a structural feature of the post-pandemic economy, not a cyclical aberration. The harsh reality is that there will be no bounce back to the pre-COVID era. As a result, cities need to move fast to diversify their downtowns economically, amplify their downtowns culturally, and remake their downtowns physically.
To achieve this, many cities have begun to focus on maximizing the conversion of office space for residential purposes. While that move is sensible and essential, cities must go further and link downtown revival with the mega-forces and unprecedented federal spending that are reshaping the broader U.S. economy.
A new economic geography is being created in the United States, driven by the reshoring of production, the decarbonization of the economy, and transformative federal and state investments around climate, defense, manufacturing, and infrastructure. This new geography is quintessentially metropolitan in scope, given the land, energy and logistical demands of many industrial facilities. But downtowns can play a fundamental role in this economic restructuring given that it demands continuous innovation in technologies, financial products, and market processes and institutions. This innovation imperative, if mastered, revalues downtowns and the agglomeration and locational advantages they bring.
To this end, a small group of cities are smartly using federal and state investments to remake downtowns for a radically different economy. Philadelphia should join them.
DOWNTOWNS IN DISTRESS
Four years after the first wave of the pandemic, the new normal of hybrid and remote work is challenging the role and function of central business districts in the United States. As recently reported by the New York Times, “Roughly one-tenth of workers are cobbling together a combination of work in the office and from home, and a similar portion are working entirely remotely.”1 Interestingly, the rise of remote and hybrid work has decoupled job growth and demand for office space, as it is becoming abundantly clear in San Francisco.
The structural shift to hybrid and remote work is affecting the valuation of office properties throughout the United States, with particular impact on central business (office) districts in Chicago, New York City, San Francisco and Washington, D.C. The latest news is sobering. A National Bureau of Economic Research paper postulates that 14 percent of the $2.7 trillion commercial real estate loan market (and 44 percent of office loans) risk default.2 Research led by Arpit Guptam, professor at the New York University Stern School of Business, estimates that the national office market lost $664.1 billion in value from 2019 to 2022.3
This disruption has already pushed down transit ridership and revenues in major U.S. cities and metropolitan areas. It is now triggering general concerns regarding the fiscal health of cities, since central business districts and downtowns typically generate a disproportionate share of municipal tax revenues. The prognosis is grim. As the New York Times recently reported: “New York City’s comptroller laid out a ‘doomsday’ scenario last summer where the value of the city’s offices settled at 40 percent below their pre-pandemic peaks. This would translate to budget shortfalls of approximately $322 million in 2025 and $1.1 billion in 2027.”4
A SHIFTING LANDSCAPE
While downtowns and cities struggle, other market dynamics and investments are reshaping the broader U.S. economy. A new global economic geography is emerging in the aftermath of the pandemic, powered by profound geo-political shifts, transnational threats and, in the United States, unprecedented investments by federal and state governments. These and other disruptive dynamics — complex, chaotic and still in formation — are already shaping the fortunes of cities and metropolitan areas.
Three changes are paramount.
HERE COMES THE NEIGHBORHOOD
First, geopolitical tensions with Russia and China have made the reshoring of production, and the control of sensitive technologies and critical minerals, issues of national security. After decades of offshoring, outsourcing and globalization at any costs, the U.S. is suddenly realizing it needs to make things again.
Second, climate change is forcing the electrification of major sectors of the economy and radical changes in the generation, transmission, and deployment of clean energy. As with geo-political tensions, climate change is driving an industrial transformation of monumental proportions and is already leading to the production and assembly of a broad array of products and parts (e.g. transmission equipment; EV vehicles, batteries, and charging; building components; wind turbines; solar panels; farming technology and equipment; and consumer energy products).
Third, these mega economic shifts are catalyzed by unprecedented federal policies and investments which set the frame for restructuring the national economy but require cities and metropolitan areas to deliver what comes next. Federal funding measures include the $1.9 trillion American Rescue Plan, the $1.2 trillion Investments in Infrastructure and Jobs Act, the $280 billion CHIPS and Science Act, the $411 billion Inflation Reduction Act and the $850 billion-plus annual Department of Defense Appropriations.
States are also taking a newly proactive approach to investment: the Michigan Economic Development Corporation has invested $100M in three centers of excellence in Detroit; California is investing $500M in regional economic strategies; and New York and Ohio have compiled billions in incentives for semiconductor manufacturers.
These macro forces have profound effects. In many respects, the hierarchy of U.S. metros — driven for decades by service clusters and consumer- and communications-related technologies — is being reshuffled. Given expanded military budgets, for example, metropolitan areas like Dayton, Ohio, and St. Louis, Mo., with large military bases, R&D facilities and production capabilities are benefitting from a defense dividend. Metropolitan areas like Columbus, Ohio, Phoenix, Ariz. and Syracuse, N.Y., for their part, are successfully attracting large semiconductor companies, and the domestic and global supply chain firms that serve these advanced industries. A battery belt of next generation automotive production is being created in real time, stretching from traditional clusters in the Midwest and the Southeast to other parts of the country.
HOW DOWNTOWNS DIVERSIFY
The new economic geography is quintessentially metropolitan in scale. As research has convincingly shown, the first wave of reshoring is disproportionately decentralized, located in places far from urban and suburban communities. Many mega factories designed to produce electric vehicles or chips are landing at the periphery of metropolitan areas or beyond, challenging the ability of stakeholders to connect all the necessary dots and realize the full potential of this resurgence for firms, people, and places.
Despite this, downtowns have a powerful, if still in formation, role to play in the new economic geography. They are not, of course, going to suddenly house super-sized semiconductor facilities. But the innovation imperative created by economic restructuring means that downtowns could, among other things, maximize the use of federal and state funding to:
The former Kresge-Newark Department Store in Newark, N.J., above, is now home to HAX, a hard-tech incubator for cutting-edge startups. The Arcade, a set of nine history buildings in downtown Dayton, Ohio, has become a hub for innovation, below.
• Become a home for the innovative parts of universities, healthcare facilities, and major industrial companies, and next generation centers of excellence, industry/academy vertical campuses, and test labs
• Become a platform for startups and scaleups in sectors such as defense tech, clean tech, med tech, and fintech
• Lead the transition to climate friendly buildings, renewable energies, and the modern grid
These innovation moves could be further supported by applying other federal and state funding to:
• Modernize transportation infrastructure by decking over or reconfiguring freeways and rail yards in strategically located parts of cities
• Enable the scaled conversion of office towers (and publicly owned parcels around transit and rail stations) to mixed-use buildings, via new financial stacks and policies
• Grow the entertainment, sports, and experiential economy at scale
THE SUCCESS STORIES
A group of cities are beginning to bend federal and state investments to enable the diversification of their downtowns. On the innovation front, downtowns in multiple cities are being infused with a burst of startup energy and public and private capital.
• In Newark, HAX, a hard-tech incubator that attracts pre-seed startups focused on emerging clean tech, robotics, neurotech, and bio manufacturing, is reinvigorating a historic department store as the hub of a new entrepreneurial ecosystem.
• In Chicago, Fulton Labs in the downtown’s West Loop has become a magnet for bioscience companies and research labs.
• In Syracuse, New York, HII, the nation’s largest military shipbuilder, has opened a new engineering facility in a former department store.
• In Dayton, Ohio, Infinity Labs, a fast-growing firm in the advanced air mobility sector, has taken space in the historic Dayton Arcade.
• Even in San Francisco, the epicenter of the “urban doom loop,” a surge in generative AI startups is leading the early rebound of the commercial real estate sector.5
Each of these efforts is relatively small and nascent, but they point to the potential for university outposts, technology firms and advanced research labs to take over spaces once occupied by office work. As an Economist correspondent recently noted about the Fulton Labs in Chicago, “Evidently almost nobody is working from home — probably because they do not have access to bioreactors in their living room.” 6 And the proximity to world class universities, and the talent and scientific research they possess, is impossible to ignore. In some cases, transformative infrastructure investments are setting the platform for new economic activity.
• In New Haven, the remake of Route 34 is enabling the build out of Downtown Crossing, a rapidly growing, life
sciences-oriented innovation district.
• In Cleveland, an unprecedented alignment of federal, state and local resources are connecting “the core to the shore,” making a formerly inaccessible industrial riverfront the centerpiece of a new urban fabric. (FN)
• In Philadelphia, the planned reconstruction of the iconic 30th Street Station will further fuel growth of the globally significant innovation district anchored by Drexel University, the University of Pennsylvania, leading hospitals and specialized companies like Spark Therapeutics.
WHERE NEXT?
As the post pandemic economy continues to take shape in the United States, it has become apparent that hybrid and remote work are not the only market or capital dynamics that have been unleashed post pandemic. The reindustrialization and decarbonization of the U.S. economy, and the innovation imperative it engenders, has created an opening for the rise of new companies, technology workers, and districts in traditional downtowns.
As our examples illustrate, a group of vanguard cities and enterprises are realizing the potential to align downtown revival with broader market dynamics by placing federal, state and local funding in the service of urban regeneration. These organic efforts, if codified and scaled, could help bring economic life back to hollowed cores and, consequently, mitigate the fiscal fall out that many cities and transit systems now face.
The federal government, to date, has been a large but passive investor, enabling but not guiding cities to blend innovation and infrastructure funding for maximum effect. That should and must change in the next few years. In cities with a large military presence, for example, vacant office space can be taken by innovative defense firms as well as defense personnel themselves. As in the late 1970s, when President Jimmy Carter signed an executive order favoring downtown office space for federal government activities, federal direction could help scale the promising actions and decisions bubbling up from leading cities.
To paraphrase Mark Twain, reports of the death of America’s downtowns are greatly exaggerated, if the nation marshals the full resources and energies of the new economic geography.
Bruce Katz is the co-founder and inaugural director of the Nowak Metro Finance Lab at Drexel University. He is a distinguished resident fellow of the Lindy Institute for Urban Innovation at Drexel.
CITATIONS
1. Ben Casselman, Emma Goldberg and Ella Koeze, “Who is Still Working from Home?,” New York Times, 3/16/2024
2. Erica Xuewei Jiang et al., “Monetary Tightening, Commercial Real Estate Distress, and US Bank Fragility, National Bureau of Economic Research, 4/4/2023
3. Alan Rappeport, “City Coffers Feel Impact as Building Prices Fall,” New York Times, March 19, 2024
4. Ibid
5. Laura Bratton, “AI startups are resurrecting San Francisco’s commercial real estate,” Quartz , 2/4/2024
6. “Science and the City,” The Economist, 12/9/2023
IF YOU BUILD IT, THEY WILL COME
IN THE ERA OF REMOTE AND HYBRID WORK, THRIVING PUBLIC SPACES HAVE THE POWER TO TRANSFORM DOWNTOWN
BY MATT RADER AND PATRICK MORGAN
Philadelphians recreate on the Schuylkill River Trail, viewed from South Street, above. Ice skating and holiday shopping at Dilworth Plaza, right.
According to data from Forbes, 20 to 30 percent of office workers now have greater autonomy over where to live thanks to evolving work-from-home and hybrid work policies.1 Philadelphia’s urban core has been greatly impacted by this shift: While Center City Philadelphia achieved 82 percent of October 2019 pedestrian traffic by November 2023, West Market Street and JFK Boulevard have remained at 53 percent.2 This reorientation is both a test for office-heavy downtowns and an opening: There is a new geo-flexible population of white-collar workers who are able to live anywhere. Cities need to compete for these residents, capturing their spending and tax revenue.
To that end, how can Philadelphia successfully make its case to residents and employees who have more choices than ever?
Part of the answer is high-quality public spaces. Exciting recent projects have prepared Philadelphia to compete, but there is more to do. In this new environment, downtowns need to become dynamic neighborhoods, and seek inspiration in the dense mixed-use areas that successfully attract residents, small businesses, and visitors.
The benefits of thriving public spaces go far beyond just economics. Well-designed parks and plazas address mounting challenges such as isolation, polarization, access to quality health and educational amenities, and climate change. Last May, the U.S. Surgeon General released a report on the epidemic of loneliness in this country, comparing its negative health effects to smoking 15 cigarettes a day.3 The number one prescription? Strengthen “social infrastructure.”
Residents already know the benefits. During the pandemic, demand for public spaces grew significantly, even in cold weather. Philadelphians expect these shared amenities to be maintained at exceptional levels and
programmed with free and diverse activities year-round. Meeting these expectations will require investment. Unfortunately, funding has not risen to match demand. The result is streets, sidewalks, playgrounds, and parks that are strained, unwelcoming, and breaking down precisely when we need them the most.
Centering high-quality public space as a defining community asset is nothing new. Ed Bacon did this in Society Hill, designing a series of charming walkways and smartly-placed parks, and Center City District has invested heavily in projects such as Dilworth Park, Franklin Square, and Sister Cities Park, as it helped grow the downtown population 54 percent in the past two decades.4
What is new is centering a holistic public space strategy in Philadelphia’s bid for residents who can choose to live, work, and play anywhere. Improving the day-to-day experience on streets and sidewalks, and in public parks, can make these spaces the unifying factor that defines downtown.
This evolution sped up during the pandemic. The success of “streeteries” as a safer alternative to indoor dining; temporary pedestrianization of important commercial streets in Philadelphia and other cities; expanded programming in places like Logan Circle and Dilworth Park; the creation of pop-up multicultural markets and performance spaces in Love Park and the Ben Franklin Parkway; and the transformation of recreation centers into learning hubs all stand as examples of COVIDera successes.
In April 2021, the City of London, London’s central business district, prioritized this strategy in their COVID recovery plan. The goal was to create “the world’s most innovative, inclusive and sustainable business ecosystem as well as an attractive place to work, live, learn and visit.” 5 About half the plan’s initiatives were targeted at encouraging people
to live and play — as well as work — in this historically office-centric area.
This ethos has been repeated in other cities, including Philadelphia. But it is easier said than done. Realizing this potential requires big mindset shifts such as a more inclusive definition of public space that includes streets, sidewalks, and parks; a willingness to center quality public space as the defining experience of downtown; and increased spending on operations.
DOING MORE WITH MORE
Philadelphia must shift from viewing public space as “nice to have” to “must have” infrastructure. In terms of budget, Philadelphia is behind other U.S cities. According to the Trust for Public Land’s Park Score 6 , Philadelphia’s park system is ranked 31st, largely because the city spent just $56 per resident, way behind other municipalities including Chicago, Washington, D.C., Atlanta, and Baltimore.
Let success be its own argument for investment. Here are a few of the recent public space improvements that have boosted the city.
Love Park and Dilworth Park are dynamic hubs of activity for residents, visitors, and families. Both provide space to showcase local artists, creatives, and businesses. Seasonal activations such as the Christmas Village and the Made in Philadelphia Market
have become must-do traditions for residents and visitors alike.
Cherry Street Pier is a mixed-use public space built out of a former municipal pier and warehouse on the Delaware waterfront. It features an open-air public garden on the river, a market/event space, and incubator workspaces for artists and makers. According to the Delaware River Waterfront Corporation (DRWC), over a million people have visited Cherry Street Pier.
Making Space is a program that gives local creatives entrepreneur-in-residence opportunities. Participants set up shop in recreation centers and provide free programming and business exposure to local youth. Of the more than 600 applications to the initiative, around 80 percent were people of color. Imagine bringing this program into downtown recreation centers or even underutilized office buildings lobbies.
Street trees and gardens can do wonders for our shared spaces, providing shade and color to the urban environment. Public-private partnerships led by the Pennsylvania Horticultural Society, Philadelphia Parks & Recreation, and others are committed to greening the city. Witness the glorious summer mixed borders in Logan Circle, pollinator gardens along the river in the Navy Yard, or the beauty of well-tended
street trees in Fitler Square to see the impact of this work. Next up is the creation of the Philly Tree Coalition to fund and implement the ambitious Philly Tree Plan. A federal grant of $12 million will help increase well-maintained tree canopy to 30 percent citywide.
Schuylkill River Trail is a multi-use trail that provides safe, scenic pedestrian and cycling routes. Executed by a wide variety of public and non-profit partners working with foundations and government agencies, the trail is spurring a revitalization and reconnection to the river. It is also a model for how a large-scale vision can be carried out in complex partnerships. With the completion of the link to Bartram’s Garden, the trail will now connect Center City to neighborhoods in Southwest Philadelphia.
CHANGING MINDSETS
Creating a unified, high-quality experience requires knitting together public space elements managed separately and to different expectations. People don’t register streets, parks, recreation centers, and trails as different kinds of space. They experience them as the urban environment and know their condition impacts quality-of-life, health, and safety. The definition of public space should respond to this intuitive understanding.
The future system must encompass all outdoor spaces used by people, beginning with sidewalks and streets and extending to include vacant land, community gardens, office building plazas, institutional spaces, and public parks and recreation centers. This entire network must put people at the center, and be imagined, built, and connected under a cohesive vision.
Expanding the definition of public space also means embracing a wider range of uses including space to work remotely, high-quality gardens, local vending, tree-lined blocks, and community programming. Achieving this network requires openness to a wider range of public space operators and funding beyond the government.
INVESTING BIG
Centering high-quality public spaces as “must have” essential infrastructure will require significant, ongoing capital investment. Today, resource constraints are a limiting factor on public space. While one-time grants can help build spaces, it takes stable longterm revenue to operate them well. Philadelphia has not succeeded at growing these operating revenue streams. Seeing the competitive advantage that comes from delivering high-quality public spaces and amenities, other cities have gotten creative when it comes to funding their parks and public spaces. One option is expanding public-private partnerships. Despite successful examples like Center City District’s Dilworth Park, PHS’ investment in trees and gardens
in public spaces, and privately-operated park concessions, public-private partnerships are sometimes controversial. Concessions provide amenities for park users while helping fund maintenance. For example, Hudson River Park’s concessions fund most park maintenance (to the tune of about $17 million a year) 7 while concessions in Philadelphia help support local public spaces such as Spruce Street Harbor Park, Franklin Square, and Dilworth Park. The Philadelphia Flower Show raises funds that power public space investments like tree planting and public gardens. Philadelphia’s successful Parks on Tap program, which stages pop-up beer gardens in neighborhood green spaces, could be scaled and expanded to draw new audiences into parks.
While Philadelphia lacks a revenue stream dedicated to public spaces, creating one would give the public space network a fighting chance at catching up on maintenance and programming while providing greater predictability around budget planning. It would also better position our system to leverage other funding sources including federal opportunities like the Inflation Reduction Act and the Bipartisan Infrastructure Law, ensuring Philadelphia gets a significant piece of this historic federal investment in urban green spaces.
Some parks departments can issue bonds to invest in parks and public spaces. Philadelphia Parks and Recreation does not currently have this option. Imagine a Tree Bond that could finance the planting and care of high-quality street trees, transforming our city’s sidewalks?
Some cities support parks and public spaces as critical components of the visitor experience. As Philadelphia looks to 2026’s Semiquincentennial festivities, how about a voluntary contribution solicited from overnight hotel stays that would fund parks and cultural institutions? Visitors could be offered the option of checking a box to add $1 or $2 per day to a new parks and cultural fund.
Imagine a future where we invest in parks and public spaces so they can be the civic infrastructure for a changing climate and the social infrastructure to bring people together face to face. Imagine a day when every sidewalk is cool and green on a summer day, and wide streets have flourishing median gardens that relieve heat and add beauty.
Philadelphia can realize this future, but it will require shifting mindsets, a willingness to center public space as Philadelphia’s greatest asset, increased spending, and the collective courage to imagine and invest in a reimagined public space network. The future will be defined by the actions we take today.
Matt Rader is president of PHS (Pennsylvania Horticultural Society). The organization is expanding its use of horticulture to advance the health and well-being of communities in the Greater Philadelphia region and beyond. Rader is also a distinguished non-resident fellow of the Lindy Institute for Urban Innovation at Drexel University and was a 2020 Eisenhower Fellow.
Patrick Morgan is a distinguished resident fellow for civic design at the Lindy Institute for Urban Innovation at Drexel University. He previously served as first deputy commissioner at Philadelphia Parks and Recreation, led the Knight Foundation’s grantmaking efforts in Philadelphia, and was chief of staff for Philadelphia’s deputy mayor for environmental and community resources.
CITATIONS
1. https://www.forbes.com/sites/forbesbooksauthors/2024/01/24/the-state-of-hybrid-workplaces-in2024/?sh=4b04b1e2a408
2. Page 1. https://centercityphila.org/uploads/attachments/clorm8db70ke3vzqdaokbqawb-cc-recovery-update-nov-2023.pdf
3. Project for Public Spaces. “2023 Annual Report,” https://uploads-ssl.webflow.com/5810e16fbe876cec6bcbd86e/65ba780a2407ca027f8f338c_PPS%202023%20 Annual%20Report.pdf
4. https://issuu.com/centercityphila/docs/development-report-2024#:~:text=Population%20in%20core%20 Center%20City,for%20residential%20or%20hospitality%20uses. Page 6
5. https://www.cityoflondon.gov.uk/supporting-businesses/economic-research/research-publications/thesquare-mile-future-city
6. Trust for Public Land. “2023 Park Score Philadelphia,” https://www.tpl.org/city/philadelphia-pennsylvania
7. Friends of Hudson River Park. July 2020, “Realizing the Benefits of Hudson River Park,” https://hudsonriverpark.org/app/uploads/2020/07/Realizing-the-Benefits-of-Hudson-River-Park.pdf
PHS’ border gardens at Logan Square, a product of public-private partnership, left. A streetery in West Philadelphia brings life to the sidewalk, above.
TEAM EFFORT
ONLY A COLLABORATIVE APPROACH CAN SAVE US FROM THE “URBAN DOOM LOOP”
BY OMAR BLAIK AND ALEX FELDMAN
Reports announcing the “end” of America’s downtowns seem to be everywhere these days. The week we began working on this column, Columbia University economist Stijn Van Nieuwerburgh told Fortune Magazine that the “urban doom loop” he predicted last year was not only still headed our way, it was going to be much worse than originally thought. “This cycle,” Van Nieuwerburgh warned us, “is out of control.”1
Absent any change in course, he may be right. Office buildings that were purchased or extensively renovated after the Great Recession have far fewer tenants than they did before
2020. Many of those ten-year loans will come due in the next few years. If defaults become widespread, the implications for bank solvency — and municipal property tax revenues — will be bad for everyone.
We say that because downtowns matter, even in their presently diminished state. Some refer to downtown as a city’s heart, but we suggest it is something even more elemental: It is the DNA, the original genetic code from which the rest of your metropolitan area — even its suburbs — grows and develops. In many cities, like U3 Advisors’ hometown of Philadelphia, down-
Texas A+M is investing in downtown Fort Worth, above.
town is the oldest part of the city, the place where it all began, and very likely the densest agglomeration of buildings, streets, and parks. This is not an accident. Cities exist to expedite the connections between ideas, capital, workers, and consumers. Cities were invented to connect people.
The era of downtown redevelopment that preceded the pandemic — several decades that saw rebounding interest after years of disinvestment — sought mostly to tackle supply. If only we could build the right kind of space, and enough of it, workers, retailers and residents would find their way there. Solve for supply, the thinking went, and buildings would fill, rents would flow, and downtowns would thrive. COVID inverted the problem and turned it upside down: Downtowns now have a demand problem.
In retrospect, the economic fragility of downtowns that were overly reliant on 9-to-5, white-collar jobs seems obvious. In an era of fast internet and record-low unemployment, bosses can no longer seriously “demand” that their workers return to the office. Workers have too much leverage, and everyone knows it.
This is the key structural change in central business districts that Van Nieuwerburgh is describing. When we don’t properly interrogate the question of who downtown is really for, monocultures will take root. Healthy and intentional diversity makes places more interesting. It also makes them more resilient. Philadelphia’s large and growing downtown residential population has helped foot traffic recover to 83 percent of pre-pandemic levels, which is more quickly than many peer CBDs.2
An inclusive and welcoming downtown where many different people feel that they not only belong but can contribute is a wonderful aspiration. But manifesting it into existence is easier said than done, and it’s a difficult thing for city leaders to prioritize when they face more urgent questions about downtown, namely: What in the world are we going to do with all of this vacant office space?
We have three potential answers to that question, each based on our experience working in urban areas with institutions of higher learning, healthcare systems, and other community anchor institutions.
The first answer is that these institutions — particularly universities and hospitals — could do more to absorb dormant downtown office space. In some places where our firm has worked, such as New Orleans and Fort Worth, institutions of higher learning are doing just this. New projects by the Tulane
The Memphis Medical District Collaborative has helped transform a neighborhood.
University School of Medicine3 and Texas A&M Fort Worth4, represent transformative investments in their respective downtowns.
In many communities, however, colleges and universities have their own struggles to contend with: falling enrollment, high debt loads, and a loss of public trust. These institutions may simply lack the capacity, leadership, or cash to take on new initiatives to support their local downtowns.
In this case, another stable organization may need to step in: local government. As Diana Lind recently suggested in her newsletter, The New Urban Order, municipalities could acquire distressed office properties at a deep discount, if they move quickly 5. In this scenario, local government could choose to fill these buildings with their own employees; more likely, they would hold them until the market reverses or strategic redevelopment opportunities arise.
Some reading this column will remember Mayor Beame of New York City unsuccessfully petitioning President Ford for relief in the mid-1970s. “Ford To City: Drop Dead” was the most famous headline from this era. In the next year or two, we may see history repeat itself, as some larger cities could turn to the federal government for help. Regardless of who occupies the West Wing, these would be fraught negotiations. Interventions from City Hall or the White House are both enormously expensive, complex, and carry outsized financial and political risk.
If your local university lacks the wherewithal to intervene
and the public sector is similarly unable to help for any number of reasons, a third scenario for avoiding the doom loop does exist: Business improvement districts (BIDs) should grow their role in shaping the future of downtown.
These are legal corporations, permitted under state statute and local ordinance, to collect assessments from commercial property owners in a specific geographic zone — usually a dense city center — and use those funds in a variety of ways to improve that place. At least before the pandemic, downtown was likely the busiest, densest, most heavily used area of a city; therefore, additional resources should be used for its care and maintenance. BIDs gather those resources and put them to work.
Many BIDs hire “ambassadors” to interact with tourists and supplement public safety officers. BIDs also handle a great deal of public realm maintenance: graffiti and litter removal, mowing and landscaping, or wayfinding signage. These organizations have been instrumental in making many downtowns feel safe and welcoming.
Right now, that’s just not enough.
Here in Philadelphia, for instance, the Center City District (CCD) has been a pioneering organization since its formation in the early 1990s. By all accounts, it has had great success executing on its stated mission of “deliver[ing] daily services with the goal of making Center City clean and safe.” 6 Cleanliness and safety are of course essential elements to the viability of any place. We would respectfully submit that CCD could be doing even more to accelerate and sustain the area’s recovery.
WE SEE THREE SPECIFIC WAYS THAT BIDS COULD DO THIS:
Demand stimulation: As we know, office buildings in many American downtowns are experiencing abnormally high vacancy rates. Some of these buildings will lend themselves to residential conversions, but their owners are unlikely to commit to this without a great deal of encouragement and technical assistance. BIDs are uniquely positioned to provide both, as well as incentives to workers who wish to occupy that housing. Additional perks for downtown workers and residents could include free or discounted public transportation or even discounted pricing at downtown shops and restaurants.
Retail curation: BIDs can also take on a more active role in retail development — using fine-grained market intelligence to determine what storefronts may be available, what goods and services may be in demand, and what kinds of incentives might be needed to lure entrepreneurs into addressing these opportunities. When left up to landlords and brokers, storefronts may remain empty for long periods while markets “recover.” BIDs can curate the mix of shops and brands (local, national, and global) that will attract buyers from both inside and outside downtown. This could be done through direct targeting and incentives. Nobody knows the potential of downtown
retail better than BIDs, and there is arguably no better time to do it than while rents are low and landlords are eager to negotiate.
Real estate stewardship: BIDs can think even bigger. They are often primarily concerned with sidewalks, medians, and streets in front of buildings. They could take a more active role in the ownership and management of buildings themselves, particularly as the connective tissue between landlords, local governments, philanthropic sources, and potential tenants. In some cases, it may make sense for BIDs to own and manage property, and to directly steward the right uses into the right sites.
In short, BIDs need to begin thinking of themselves as anchor institutions and acting accordingly. While not technically a business improvement district, the Memphis Medical District Collaborative (MMDC) is a great example of an organization that has been doing all of the above. Launched eight years ago with the support of nine major local educational and healthcare institutions, MMDC has significantly contributed to the transformation of a chronically underperforming district immediately adjacent to downtown. In addition to routine clean-and-green services, MMDC has taken a very dynamic leadership role with regard to real estate development. In 2023 alone, the area saw the opening of nearly a dozen new businesses, the construction of hundreds of new apartments, and the completion of infrastructure improvements aimed at creating a more walkable community. Moreover, the MMDC welcomed 40,000 visitors to various sponsored events, including fitness classes and festivals7. While MMDC’s staff does a lot of things well, the larger point is that they do a lot of things. Infrastructure maintenance, real estate strategy, programming, and other activities may feel like distinct and separate lanes, but MMDC knows they all go towards the same destination: an economically thriving district. Because MMDC takes nothing for granted, they can swiftly pivot into doing whatever is needed to make progress towards that goal.
Downtowns are at a perilous moment, but there are positive signs: Edelman Intelligence and the Bureau of Labor Statistics say that there are now some 76.4 million freelancers in the workforce, a number that grows by 2 million people every year 8. Americans are living longer, having fewer children, and driving less. We are becoming a nation that craves the kind of convenience, connection, and flexibility that downtowns have always provided. Returning to the questions of who is the city for and why, we may be able to glimpse the future by looking at the past. Downtowns can be — and must be — for everyone: workers, visitors, and residents of varying ages, income levels, and backgrounds. Put another way, no other part of the city can do what downtowns are built to do, which is foster
A former Sears is reborn as Crosstown Concourse, a mixed-use development in Memphis, Tenn.
PHOTO: JAMIE HARMON CROSSTOWN ARTS
tight and highly productive economic connections. They can bring different kinds of people from different cultures and backgrounds together.
THIS DIVERSITY HAS A DELIGHTFUL BYPRODUCT: EMPATHY.
Nowhere else in your city, indeed, nowhere else in the world, will people of varying viewpoints and lifestyles spend as much time interacting, sharing space, accommodating each other, and working together. The discord and rancor that seems to define so much of our politics can be tempered amid this cooperative friction. In this way, downtowns produce and reproduce a special kind of civility, one that is essential to the functioning and flourishing of any place. In other words, so long as downtowns are at risk, so is democracy.
We realize that we are calling in anchor institutions, local governments, and business improvement districts to behave in new and perhaps unexpected ways. If these entities see that it is in their self-interest — and everyone’s — to get involved in their downtowns now, we may be able to defeat the doom loop before it starts.
Omar Blaik is the founding CEO of U3 Advisors, a Philadelphia based consultancy that helps institutions across the globe realize their goals for economic growth and community impact. Previously, Blaik served as the senior vice president of facilities and real estate at the University of Pennsylvania.
Alex Feldman is a managing director of U3 advisors, where he leverages his expertise in architecture, real estate, and urban planning to transform and uplift communities. He serves as a lead strategist in the firm’s role in the anchor-driven transformations of communities such as Memphis and Fort Worth.
CITATIONS
1. The ‘prophet of urban doom’ says a 1970s-style “doom loop” is here for New York City, and it’s just the first inning of the ballgame. (2024, February 26). Fortune https://fortune.com/2024/02/25/ commercial-office-real-estate-crisis-vacancy-remote-work-newyork-city-doom-loop/
2. Center City Retail Report, November 2023. (2023, November 20). https://centercityphila.org/research-reports/ccd-retail-report-11-2023
3. Big vision for the Big Easy - U3 Advisors. (2022, March 4). U3 Advisors. https://www.u3advisors.com/projects/big-vision-for-thebig-easy/
4. Texas A&M Fort Worth Innovation Hub - U3 Advisors. (2022, November 15). U3 Advisors. https://www.u3advisors.com/projects/ texas-am-fort-worth-innovation-hub/
5. Should cities buy office buildings? (2024, February 19). The New Urban Order. https://thenewurbanorder.substack.com/p/should-cities-buy-the-dip-and-stock
6. Center City District. (n.d.). https://centercityphila.org/
7. MäKi, A. (2024, January 2). Memphis Medical District marks banner year of robust growth. Daily Memphian. https://dailymemphian.com/article/40789/memphis-medical-district-marks-year-ofgrowth
8. Freelance, side hustles, and gigs: Many more Americans have become independent workers. (2022, August 23). McKinsey & Company. https://www.mckinsey.com/featured-insights/sustainable-inclusive-growth/future-of-america/freelance-side-hustles-and-gigsmany-more-americans-have-become-independent-workers
THERE IS NO CRYSTAL BALL FOR AMERICA’S CITIES COMMENTARY
WITH ISSUES AROUND LAND USE
MORE COMPLICATED THAN EVER, A DEVOUT URBANIST REFLECTS ON WHERE WE’VE BEEN AND WHAT THE FUTURE HOLDS
BY JOSEPH SCANGA, HDR
I grew up in a suburb northwest of Philadelphia and would often catch the train from Glenside Station to Center City. After decades in the Bay Area, I still vividly remember those early days of travel and exploration — Wanamaker’s, Sansom Street Oyster House, City Hall, the Philadelphia Museum of Art, the Pennsylvania Academy of Fine Arts, the Mummers Parade, and baseball games at Connie Mack Stadium in North Philadelphia. I saw the realization of Edmund Bacon’s vision for the city unfold before my eyes: Society Hill, Market East, and Independence Mall. These memories shaped my perspective on cities.
Following the bombing of the Houses of Parliament during the Blitz in WWII, Winston Churchill famously said, “We shape our buildings, and afterwards they shape us.” As an urbanist, I would change “buildings” to “built form.” Our decisions as urban designers influence lives. Streets and open spaces form the places that shape us beyond just buildings. Our job is to forecast the future, steer growth towards community well-being, and move us towards a regenerative future.
I’ll share another quote that never left me. During a lecture
at the Commonwealth Club in San Francisco, global urban design leader Peter Calthorpe said, “Cities in general are really the vessel of the future of mankind.” Calthorpe and I have been business partners for 35 years. He has been my mentor throughout my career while I have led projects around the world.
In 1989, when I joined Calthorpe Associates (now merged with HDR), the New Urbanist movement was just a fledgling idea. We needed a concept for moving beyond Duany Palter-Zyber’s Traditional Neighborhood Design (TND) and incorporated Calthorpe‘s ideas from his book Sustainable Communities Transportation was the game changer in these conversations. The idea of transit-oriented design (TOD) was formulated in The Next American Metropolis, the book that he and Shelley Poticha co-wrote about concepts of good urban design.
Ultimately, my early trips to downtown Philadelphia and a career working with Calthorpe and others to define new ideas for the future of cities translated into my approach to urban design. It is one predicated on an alternative to the car and it places public transit at the heart of our communities. It also looks at open space as the most important fabric of the city.
Today, for the first time in my career, I feel less confident predicting the future of cities, and that is primarily because of land use.
MAKING THE FUTURE
Every ten years, urbanists seem to evaluate and re-invent one land use at a time. Thirty years ago, we tried to fix the sprawling suburbs. Twenty years ago, we re-thought office parks. Ten years ago, we were questioning the future of retail. Today, our challenge is to envision the post-pandemic downtown. This picture is complicated by four major factors.
As we return to the office, city buildings and streets will start to come to life again. New office buildings should be designed with flexibility, considering floor heights, and providing more plumbing shafts so these structures can be more flexible and available for future potential uses such as residential.
We also need to support workforce housing in our downtowns. The world’s population is about to hit 9 billion, with growth tripling in one generation. Underutilized land along our boulevards and within our cities’ cores should be easiest to re-zone as demand changes over time.
Retail lives! The internet has not been able to put an end to in-person shopping and we need to think what this land-use will look like beyond warehouse distribution centers.
When it comes to transportation, there won’t be a fleet of single use autonomous vehicles for some time, so a good first step would be to implement surface rapid transit systems with designated corridors such as bus rapid transit. Whether they are autonomous or not, we cannot allow cars to continue to clog our cities.
As urbanists who predict the future, these are the questions we face. Usually, we deal with only one of these areas but now we are in a strange moment during which we are unclear about all these uses.
A RESILIENT PHILADELPHIA
The father of modern Philadelphia, Edmund Bacon, writing in 1959, made his own predictions about the Philadelphia of 2009. He wrote, “...centrality and clarity of form, reinforced by the fact that City Hall was built in ‘Center Square,’ just where Penn suggested it should be, gives downtown Philadelphia much of the character that it has today.”
This fifty-year look into the future of Philadelphia was influential yet controversial. It had flaws, as did many of the urban renewal projects executed during his long tenure as executive director of the Philadelphia City Planning Commission. I am on the side of the urban design activist Jane Jacobs, who fought against the destructive mid-century redevelopment of our inner cities, but I think Philadelphia proved resilient at its core by preserving William Penn’s two-square mile grid plan of 1682, rather than going the way of Robert Moses with his notorious destruction of neighborhoods in New York City in favor of cars and poorly designed housing. That said, I will never forgive Bacon for advocating
Surface rapid transit has the potential to transform cities.
for the separation of land uses. In my studio, the rallying cry of “mixed use” is repeated at least once a day.
Amending land-uses is easier said than done, but recent planning developments seem to be moving Philadelphia in the right direction, including the development of the Central Delaware Waterfront, the Hilco development of the former 1300-acre Philadelphia Energy Solutions oil refinery on the Lower Schuylkill River, the reimagination of the Ben Franklin Parkway as a more people-centric series of parks, and the creation of new innovation districts in University City, Schuylkill Yards and uCity Square. Each of these developments represents an investment in making the city resilient in an unknown future for land use, urban design, industry and society.
Joseph Scanga is a vice president at HDR I Calthorpe and has been with the firm since 1989. He has managed projects in countries worldwide and has served clients in both the public and private sectors. He holds a BFA and BArch from RISD and an MArch from UC Berkeley.
Schuylkill Yards, an ambitious mixed-use development in West Philadelphia.
DESIGN PROFILE
URBAN HOSPITALITY
BLUE BOTTLE WOLF POINT
Bohlin Cywinski Jackson
Blue Bottle Coffee’s café at Wolf Point is situated within a new residential tower overlooking the Chicago River. A series of full-height channel glass partitions within the 3,600 square-foot cafe create the intimate spaces the brand is known for, with a center bay that showcases the art of coffee making, and three light-filled lounges along the perimeter.
Wolf Point was an opportunity for the clients to provide a new amenity for the neighborhood and its increasing residential development. But the scale of the space — roughly one and a half times the size of Blue Bottle’s next largest U.S. café — represented a significant challenge. To avoid feeling out of scale while maintaining an open floor plan, the firm designed floating channel glass partitions extending 17 feet high, creating a center bay and three perimeter lounges, while allowing natural light to filter throughout. These walls, and a series of custom millwork pieces, create comfortable nooks for seating and display.
Another challenge was accommodating Blue Bottle’s pilot programs of social outreach. Custom millwork houses exhibition areas, while a small lounge provides flexibility for private tastings and hands-on instruction, with a full coffee and espresso bar concealed behind bifold pocketing panels. In the north lounge, a custom credenza hosts revolving exhibitions and AV educational programs or can be converted into a point-of-sale station for local vendors.
The cafe’s honest and elegant material palette is anchored by the green channel glass walls. The material was specified with an iron content that celebrated its green hue, and a hazy, sandblasted finish that transforms with changing light throughout the day. The service counter is faced in a matching back-painted glass, with a stainless top. European beech millwork creates a warm contrast to the green glass and is detailed to feel unified throughout
PROJECT: Blue Bottle Wolfe Point
LOCATION: Chicago, Ill.
CLIENT: Blue Bottle Coffee
PROJECT SIZE: 3,600 square feet
PROJECT TEAM:
Bohlin Cywinski Jackson (Architect)
DXU (Collaborating Firm)
Silman (Structural Engineer )
AMA Consulting Engineers ( Electrica l /
Mechanical Engineer)
41 North (General Contractor)
DESIGN PROFILE URBAN HOSPITALITY
THE QUOIN
Stokes Architecture + Design
Wilmington’s historic Security Trust and Safe Deposit Building, built in 1885, has been reborn many times. Listed on the historic register and originally designed by Philadelphia architect Frank Furness, with an addition by Furness and Evans, the building’s exterior has been restored, while its interior has undergone a complete renovation into the city’s first boutique hotel, The Quoin.
The hotel features 24 guest rooms, a restaurant, rooftop lounge and deck, and a basement cocktail lounge. The project adds to the rebirth of Wilmington’s Market Street, joining many new restaurants and apartments and helping establish the neighborhood as a regional dining and nightlife destination.
The Quoin’s design was inspired by Frank Furness’ interiors as well as other contemporaries such as William Morris, while incorporating custom mid-century furnishings and contemporary lighting fixtures. The entry lobby retains the original travertine flooring and features custom windows by Greg Stefan, inspired by original Furness art glass. The first floor also houses a 100-seat restaurant and bar, with an open kitchen featuring a wood-burning oven and grill. A new patio was added along the south side, allowing for seasonal outdoor dining and a view of the Delaware Historic Society gardens.
The guest rooms incorporate the original arched windows, along with vaulted ceilings inspired by the old banking hall. For a daytime view of the city or a drink during sunset, guests can head to the new roof deck. The deck and adjacent interior lounge is intentionally tucked behind the existing mansard roof so as not to be visible from the street.
The basement level features a cocktail lounge, Simmer Down. Mysterious and moody, it boasts the original vaulted brick ceiling, a new curved bar, a working fireplace, and murals by Reverend Michael Allen
PROJECT: The Quoin
LOCATION: Wilmington, Del.
CLIENT: Method Co.
PROJECT SIZE: 24,000 square feet
PROJECT TEAM:
Stokes Architecture + Design (Architect)
Method Studios (Collaborating Firm)
P2 Structural Engineering (Structural Engineer)
DEDC (Mechanical/ Plumbing Engineer) Beam Ltd. General (Lighting Designer)
BPGS Construction (General Contractor) Powers and Company Inc. (Historic Consultant)
HYATT CENTRIC PHILADELPHIA DAS Architects, Inc.
The HYATT Centric Hotel, located at the southeast corner of 17th and Chancellor Streets in Center City Philadelphia, replaced a three-story parking garage. Each HYATT Centric Hotel is designed to reflect its urban location, local culture and style. The 13-story building features 332 guest rooms, a multi-level lobby, a restaurant and bar, a social lounge, a small banquet/ meeting facility, and a fitness center.
The site is surrounded by several large early 20th century buildings, including the Warwick Hotel, a 20-story brick building, and 1616 Walnut, now called “The ICON”, an early 1900s 25-story brick and terracotta “Art Deco” hi-rise. The HYATT Centric, smaller by comparison, was designed to maximize the impression of height and to reflect the vertical expression of the “Art Deco” hi-rise era.
The Hyatt Centric’s ground floor is defined by a pre-cast colonnade with full height glazing that forms the building’s base. Above the corner and extending upward to the top floor, the building mass has been carved to provide openness — light and air — to the street. This corner also features a second-level rooftop garden. Faceted façade panels create an angular three-dimensional rhythm that changes as you approach the building. Materials include gray iron spot brick, textural precast concrete panels, light bronze and stainless trim, and lightly tinted glass. The HYATT Centric is a LEED Silver Certified Project.
DESIGN PROFILE URBAN HOSPITALITY
PROJECT: Hyatt Centric Philadelphia
LOCATION: Center City, Philadelphia
CLIENT: Hyatt
PROJECT SIZE: 190,000 square feet
PROJECT TEAM:
DAS Architects, Inc. (Architect)
Cr´eme Design (Interior Design)
Bohler Engineering (Civil Engineer)
Harman Group (Structural Engineer)
Bala Consulting Engineering (Mechanical Engineering)
Clemens Construction Company, Inc(General Contractor)
Bill Curren Design (Architectural Metalwork)
The Lighting Practice (Lighting Consultant)
www.watsontownbrick.com