CONTEXT - Summer 2023

Is Housing Affordable?

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Published JUNE 2023

IN THIS ISSUE , we explore a diverse group of communities affected by the affordable housing shortage and provide solutions on how to solve it.

FEATURES

14 Challenged by Affordability by Kevin C. Gillen, PH.D

18 Chinatown, Affordable Housing, and the Right to the City by Caroline Aung

22 Philadelphia’s Preservation Challenge by Sue McPhedran, Kyla Weisman Baker, Carolyn Placke, and Daniel Swain

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.

2023 BOARD OF DIRECTORS

Rob Fleming, AIA, LEED AP BD+C, President

Brian Smiley, AIA, CDT, LEED BD+C, President-Elect

Robert Shuman, AIA, LEED AP, Treasurer

Jeff Goldstein, AIA, Past President

Fátima Olivieri - Martínez, AIA, Secretary

David Hincher, Director of Sustainability + Preservation

Phil Burkett, AIA, WELL AP, LEED AP NCARB, Director of Firm Culture + Prosperity

Erick Oskey, AIA, Director of Technology + Innovation

Tya Winn, NOMA, LEED Green Associate, SEED, Director of Equity, Diversity + Inclusion and Public Member

Ximena Valle, AIA, LEED AP, Director of Design

Kevin Malawski, AIA, LEED AP, Director of Advocacy

Fauzia Sadiq Garcia, Director of Education

Timothy A. Kerner, AIA, LEED AP, Director of Professional Development

Danielle DiLeo Kim, AIA, Director of Strategic Engagement

Michael Johns, FAIA, NOMA, LEED AP, Director of Equitable Communities

Clarissa Kelsey, AIA, At-Large Director

Sophia Lee, AIA, CPHC, LEED AP BD+C, WELL AP, At-Large Director

Scott Compton, AIA, NCARB, LEED AP, AIA PA Representative

Mike Penzel, Assoc. AIA, Director of Philadelphia Emerging Architects

Luka Lakuriqi, Assoc AIA, SEED, Director of Philadelphia Emerging Architects

Kenneth Johnson, Esq., MCP, AIA, NOMA, PhilaNOMA Representative

Rebecca Johnson, Executive Director

CONTEXT EDITORIAL BOARD

CO-CHAIRS

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

Daryn Edwards, AIA, CICADA Architecture Planning

Clifton Fordham, RA, Temple University

Fauzia Sadiq Garcia, RA, Temple University

Timothy Kerner, AIA, Terra Studio

Milton Lau, AIA, BLT Architects – a Perkins Eastman Studio

Jeff Pastva, AIA Scannapieco Development Corporation

Eli Storch, AIA, LRK

Franca Trubiano, PhD, University of Pennsylvania

David Zaiser, AIA, HDR STAFF

Rebecca Johnson, AIA Philadelphia Executive Director

Elizabeth Paul, Managing Editor

Jody Canford, Advertising Manager, jody@aiaphila.org

Anne Bigler, annebiglerdesign.com, Design Consultant

Laurie Churchman, Designlore, Art Director

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SHORTAGE

While affordable housing is seemingly an evergreen issue in both National and local politics, it has become a top of mind priority that outpaces a litany of challenging problems . What makes it even more pervasive, is that it is not isolated to large metro areas that grab headlines. Take for example, Chambersburg, PA — a city of 22,354, whose 2020-2024 municipal plan includes tackling an unmet need of affordable housing options as one of their highest priorities. And they are not alone.

What makes Philadelphia a unique place to have a pulse on this crisis is the open Mayoral primary taking place as we assemble this release of CONTEXT. As editors and residents of the city, we are able to get real time polling data on issues. According to the latest commissioned by the Lenfest Institute for Journalism, housing comes in at number four behind crime, education, and the economy. Homelessness was right behind housing and is essentially linked, as there are an increasing number of housing insecure individuals and families as a direct result of a lack of affordable housing.

The feeling of the polls are backed up by data as well. Throughout this issue there are a number of metrics that will be explored, but the top line is 40% of Philadelphia households are cost burdened with 22% being severely cost-burdened (greater than 50% of income is spent on housing). Philadelphia is not alone among peer cities with this statistic, but the numbers increase substantially at the lower income scale, where 76% of households earning between $10-30k per annum are cost burdened. Since Philly has been established as the poorest of the twenty five largest cities, this puts a strain on a large portion of the population.

However challenging the problem is though, there are solutions out there. The contributors to this issue are prime examples of boots on the ground advocates actively supporting affordable housing. They demonstrate a variety of ways to share information and resources so that people can get together to form “community”, highlight the human scale energy uniting neighbors to form cultural identities, and they connect dreamers to capital to help turn their visions to reality. Finally, they shine a light on market factors and large forces beyond individual control that can shape policy and long term thinking.

MILTON LAU, AIA

Dear Friends and Colleague,

As we gear up for the summer of 2023, I am delighted to share three important updates.

Firstly, affordable housing remains a pressing issue in Philadelphia, and we believe that bold and ambitious strategies are required to make a meaningful impact. At AIA Philadelphia, we have been advocating for a “go big” approach to affordable housing, and we supported the construction tax as a way to bring much-needed resources to scalable solutions. Although this was a controversial issue, we felt that it was a necessary step to address the crisis of affordable housing in our city. I’m grateful to the CONTEXT Editorial Committee and this issue’s editors, Milton and Jeff….for putting together this thoughtful issue.

Secondly, I regret to inform you that the Forum on Architecture and Design will not be taking place in 2023. Instead, our board and staff have decided to take a deep dive into how we can best meet the educational needs of our members through our upcoming 5-year strategic planning process, which will commence at the end of this year. We recognize the importance of continuing education and professional development, and we are committed to ensuring that our members have access to the resources they need to stay at the forefront of their field. We have several exciting

programs lined up this fall — check out our website calendar for updates.

Lastly, I am thrilled to announce our first AIA Philadelphia Home Tours, which will take place during the DesignPhiladelphia festival this year. This exciting event will showcase some of the best single-family residential architects in our city, and we cannot wait to highlight their work. We are excited to provide a platform for these talented architects to share their vision and creativity with our community.

AIA Philadelphia remains dedicated to promoting innovative, sustainable, and equitable design practices in our city. We are committed to advocating for bold strategies to address affordable housing, investing in the professional development of our members, and showcasing the exceptional work of our local architects. We look forward to continuing to serve our community and creating a better built environment for all.

Sincerely,

Rebecca Johnson Executive Director, AIA Philadelphia

Save the Date! AIA Philadelphia’s first Home Tours is scheduled. Join some of AIA Philadelphia’s brightest residential architects as they showcase their work and take you on behind-the-scenes tours of the homes they designed. A penthouse condo overlooking Rittenhouse Square? An elegant brownstone in Society Hill? A modern rowhome in Northern Liberties? A charming trinity in South Philly? What will you see on the tour?

Details of the tour are still in the works but stay tuned to learn more about the homes included in this inaugural tour. And mark your calendars; the Home Tour will take place during the second weekend of the DesignPhiladelphia Festival, October 14-15.

ONE YEAR AGO… THE LAUNCH OF THE NEW AIA PHILADELPHIA WEBSITE

Last year around this time we launched our new AIA Philadelphia website followed a few months later by our new Center for Architecture and Design website. So far the website has proven to be a successful means of engaging with our audience. But what does that really mean? Well, we thought we would break it down by the numbers.

Over 2,000 individuals have joined our online community and have interactive profiles. • Our community members include Architects, Designers, Educators/Faculty, Engineers, Students, Contractors, and Elected Officials. • Over 300 new records yesterday! • The site averages over 1,000 visitors per day. • We have 20 active Committees with over 400 people joining a committee online. • We are sending more targeted emails with an average open percentage over 30% . • 15 articles with more than 1,000 reads

If you haven’t already, take a few minutes and join our online community. Here’s how:

• Go to https://aiaphiladelphia.org/register

• Set up your profile

• Start connecting with other members, join a committee, and share your stories with us so we can share them with the larger community.

As the Architecture and Design Education in-classroom programs pause for summer break, we checked in with some teachers and volunteers to share their experiences with the program.

SLAM, ZUZANNA BOJARSKA:

“It has been very rewarding to see various students’ confidence grow throughout the classroom sessions, either through participation, asking questions, and also through their artistic expression. Seeing students be completely in the zone when creating their projects really makes all the planning and hoping activities are engaging worth it.”

WRT, YASMINE MCBRIDE:

“Professionals in our industry should always strive to create more equitable access to education and exposure to the design field at an early age. Many of us can relate to identifying specific moments in our childhood or schooling where architecture, design, or planning processes and concepts “clicked”. It is our responsibility to cultivate safe and joyful environments where students can have the opportunity to have these moments for themselves. Programs like this enrich the experience of the students and have the potential to create ripple effects which improve the profession as a whole.”

RHAWNHURST ELEMENTARY 4TH GRADE TEACHER, MICHELLE BERNARDI:

“I have a few students who don’t speak English. During the building part, they were able to shine and work with their groups in ways they aren’t able to in other parts of the school day.”

POTTER THOMAS, AUTISTIC SUPPORT, DARA FLEISCHMAN:

“I loved how engaged my kids were with each lesson and how the volunteers integrated our curriculum into each lesson, especially with Math. My students could see the direct connection between what they are learning and real-life situations.”

PHOTOS: CFAD STAFF AND VOLUNTEERS (3)

PHOTO: SCOTT SPITZERR

Details of the 2023 DesignPhilly Festival are still coming together, but one thing we know for sure is that there will be a lot to do October 4 -15. Here are some of the highlights.

EVENT PARTNER FAQS

What’s the difference between an event/installation and an open house/design display?

An event should have programming, whether that’s a talk, exhibition, or workshop, while an open house should be focused on mingling with guests at your office or studio with no programming.

How do I update my event information?

KICKOFF PARTY OCTOBER 4

The party of the year, come to Cherry Street Pier and enjoy an evening of design and socializing.

AIA HOME TOURS OCTOBER 14-15

Join AIA Philadelphia architects as they showcase five to six local homes around the city.

KIDSFEST OCTOBER 7-8

After you fill out the event information form, you should receive a confirmation email with your responses. At the bottom of the email, there is a link to update your response. If you submit multiple events, please save all of the confirmation emails as each event has its own update link.

Can I update my event information after the deadline?

Yes, but you should have the broad strokes of your event submitted before the deadline. This includes: a title, description, date, location, logo, and photo.

Read the complete answers to these and more at www.designphiladelphia.org

Don’t Forget to Submit .your Events by June 31 to be included in our print materials

PHOTOS: CHRIS KENDIG

A weekend of family fun at Cherry Street Pier. Hands-on activities for kids of all ages.

COMMUNITY ROOTS, GENERATIONAL IMPACT

BY NAIM MITCHELL AND ABDUL-RAHIM MUHAMMAD

The Islamic Cultural Preservation and Information Council (ICPIC) is an African American Muslim cultural organization that was founded 29 years ago as a progressive non-profit dedicated to preserving cultural heritage in Philadelphia. While they have a citywide presence, their primary catchment is the Belmont neighborhood in West Philadelphia, where they are a leader in planning the revitalization of the community and are charged with the creation and branding of the New Freedom District.

The Belmont section of Philadelphia is a community facing challenges due to high unemployment (23%), poverty (55% of households are under the poverty limit), and land vacancy (24.6%).

It is one of Philadelphia's federally designated Promise Zone and Opportunity Zone areas, a low-income urban community with a rich cultural history. Blighted, unused property is a major challenge for the 4200 block of Lancaster Avenue specifically. Despite these concerns and marginalized conditions, Belmont residents have supported the revitalization efforts by organizing and deploying resources to maintain the essence upon which the community's foundation was built. ICPIC saw an opportunity to help organize and connect this historically underserved community to improve the quality of life for residents. They have spent several years acquiring multiple parcels on the 4200 block of Lancaster Avenue with the plan to expand its cultural center and bring neighborhood-friendly retail and quality affordable housing to the Lancaster Avenue corridor. The vitality of a commercial corridor is central to any neighborhood’s long-term health and ICPIC is committed to transforming Lancaster Avenue into a vibrant, economically competitive retail corridor enhancing small businesses and West Philadelphia residents.

To help expand their capacity and realize this plan, ICPIC selected Mosaic Development Partners JV to serve as their development partner in the lead real estate project for the New Freedom District. It will be a mixed-use, mixed-income project, anchored by the new home of the New Africa Cultural Center and Museum. Mosaic Devel-

The proposed facade of the mixed-use, New Africa Cultural Center and Museum in the 4200 block of Lancaster Avenue.

opment Partners, JV LLC is a boutique, minority-certified real estate development company founded in 2008, by Gregory Reaves and Leslie Smallwood-Lewis. Mosaic develops projects that bring positive change and produce impact throughout the region while creating an environment of diversity, sustainable development, and social equity. “This partnership is pivotal for the community. With the development of this project and bringing ICPIC’s vision to fruition, many families will have quality affordable housing, education, meals, and jobs created in their neighborhood.” The identity and heritage of this community is something to be preserved for generations to come. They believe that for communities like Belmont to flourish it takes a collective effort to achieve advancement and progress.

Mosaic and ICPIC plan to construct two new structures flanking both sides of Lancaster Avenue to anchor the center of the New Freedom District. The vacant lots acquired on the odd side of Lancaster Ave have been consolidated into one assembled parcel to construct a new five-story multi-use facility. The 3,400 SF first-floor commercial space will be an expanded home to the New Africa Center/Muslim American Museum & Archive. The upper four floors will be developed into 35 residential units ranging from studios to two-bedroom apartments. The vacant lots on the even side of Lancaster Ave will be consolidated into one assembled parcel to construct a new four-story mixed-used building. The 1st floor will have three small retail spaces for lease and the upper floors will house seven apartment units. These two mixed-used buildings will stabilize the 4200 block of Lancaster Avenue and provide a new mix of businesses and apartments along the Lancaster Avenue corridor. The target population will be largely driven by income level with over 80% of the units being affordable to residents at 50% AMI or less. The remainder will be market rate. Mosaic and ICPIC have worked diligently to obtain local and state grants to help make the project viable and affordable under local guidelines.

The impact of this project expands beyond just a new development as it will strengthen the local community by revitalizing and activating the commercial corridor. The retail will attract consumers by foot, car, and nearby public transportation. Housing will provide greater density, quality, safety, and affordability to an area where 48% of renters are spending more than 30% of their income on housing expenses. Affordable housing has been a long-standing problem in the city of Philadelphia, but with zoning-related legislation such as the mixed-income housing bonus bill and the inclusionary zoning bill, Mosaic and others now can develop larger builds with greater density in designated zones to account for the need for affordable housing.

With the help and guidance from Mosaic Development Partners JV, ICPIC’s dream project will soon become a reality. It will celebrate and honor the rich history and legacy of local community ancestors and bring quality affordable housing to a neighborhood in great need, revitalizing and activating the commercial corridor. This joint venture is fueled by the love of community and their desire to see how organizations such as ICPIC can continue to make an impact in people’s lives. ■

Naim brings more than 10 years of experience in Real Estate to the firm. Naim has also held community-based positions on local planning and zoning boards. During his time in college, he derived his passion in real estate by evaluating how cities can be transformed through development and how it connects to job creation and quality of life. In joining the Mosaic team, Naim found that his values aligned with the core values of Mosaic.

Over 30 years of educational and cultural programming to inform and preserve the heritage of West Philadelphia's Islamic community as well as advancing the revitalization of Lancaster Ave and its corridor. Mr. Muhammad has spent his life's work building and re-investing into his community. He has established programs of education, HIV testing, professional development, outreach and community meals. Many people refer to him as the Mayor of Lancaster Ave given his love for the community and the people of it. (New Freedom District)

A mixed-used town home project on the opposite block face as the proposed cultural center.

PHILADELPHIA’S HOUSING MARKET REMAINS

CHALLENGED BY AFFORDABILITY

BY KEVIN C. GILLEN, PH.D

PRICE POINTS

• The tough part: sales activity has dropped dramatically over the last twelve months. The total volume of arms-length house sales in Philadelphia are down a whopping 51% from a year ago. A combination of increased unaffordability, limited supply and increased interest rates are to blame.

• But, on the plus side: price declines have been very modest … at least so far. While sales have plummeted, prices have held relatively steady. Controlling for season and quality, the general level of house prices has declined by only 1.7% from their peak of less than a year ago.

Let’s start with an overview of current conditions: it’s definitely a different market right now than it was during the last several years. But, while the latest numbers may not be great, they’re really not all that bad either.

APPRECIATION INFORMATION

• Both raw house prices and regression-based analysis indicate only very modest price adjustments. According to both public records and Zillow, the median house price in Philadelphia peaked at $217,000 last July, and now stands at $213,300; a 2% decline.

• This trend is true nationally, as well as locally. During the same period, Zillow reports that the typical U.S. house price declined by only 1.1%.

• But, keep in mind that this decline is especially modest when compared to the longer-term trend of the current cycle. House prices have been rising ever since bottoming during the last downturn, which occurred in

FOR SALE

• Inventories — the number of homes listed for sale — remain exceptionally low. Approximately 12,000 houses are currently available for sale across the Philadelphia region. This is half of the average historic level of nearly 25,000 homes — and is also one of the main reasons that prices have shown so little decline despite a softening market and economy.

• But, Philadelphia’s house price growth in recent years has exceeded the economy-wide general rate of inflation. The chart at right compares the house price index (HPI) for Philadelphia County to the national consumer price index (CPI) since 19501

2012. In Philadelphia, house prices are up 78% from just over ten years ago. So, even with the recent declines, that is still 78 steps forward and 2 steps back!

• Also, bear in mind that Philadelphia’s house prices tend to be somewhat less cyclical than other major U.S. metros. Compared to most

other large U.S. metros, Philadelphia’s house price do not rise as much during the boom times, but they also don’t fall as much during the bust times. As I like to say: we don’t party as hard during the good times, but our hangovers are much milder the next morning.

THE DECADE DIFFERENTIAL

• The break point is the year 2000. From 1950 to 2000, the value of the typical Philadelphia house essentially grew at the same rate as national price inflation. But, since 2000, Philadelphia’s house price growth has substantially exceeded the nation rate of inflation.

• Philadelphia’s annual rate of house price growth since 2000 is approximately 1.5 times its annual rate of house price growth before 2000. From 1950 to 1999, the typical Philadelphia home appreciated in value by 4.7% per year. Since then, it has appreciated in value by just over 7% per year.

• While that difference may not initially seem large, when compounding is taken into account over several decades, the resulting difference is very large. For example, consider that the median Philadelphia house price in 1950 was $7,000. A home purchased at that price would be priced at $191,100 today if

it appreciated at 4.7% annually. But, that same home would be priced at $913,545 if it appreciated at 7% annually: a $722,445 difference! Which one is more affordable, especially in a city where the median household income is just less than $53,000?

• Philadelphia’s house price growth has also exceeded its income growth. One of the most common— and simplest—measures of housing affordability is the ratio of house prices to household incomes. As

should be obvious, the higher this ratio, the greater degree is a market’s unaffordability. Federal guidelines generally suggest that a ratio less than 3.5 indicates a relatively affordable housing market; i.e. typical local house prices are no more than 3.5 times local annual incomes. The following chart shows the ratio of median house prices to median incomes since 2000 for Philadelphia County, Philadelphia’s suburbs2 and the U.S. as a whole.

IN THE REGION

• As can be observed, housing unaffordability has grown significantly in recent years. Philadelphia’s price-to-income ratio currently stands at 3.7, while in its suburbs it is 3.9. These currently exceed the federal government’s suggested affordability threshold of 3.5.

• But, while unaffordability has increased, it should be understood in context…even if the trend is concerning. Not only is the margin by which Philadelphia’s ratio exceeds federal guidelines fairly small, it is still less than the national average, as well as below its previous peak during the “Housing Bubble” years of the mid-2000s. Philadelphia’s ratio of 3.7 is also well below such highpriced cities as New York, Boston or San Francisco, where price are 7-8 times annual incomes.

• However, there is significant variation in housing affordability across our region. The chart at left shows the price-to-income ratio for each county in the Philadelphia MSA.

Housing unaffordability has sharply increased since Covid.

PAYING THE RENT

• Perhaps surprisingly, the relatively wealthier counties show greater unaffordability while the relatively lower-income counties have less unaffordability. All of the Pennsylvania counties (plus New Castle, DE) have affordability ratios exceeding 4.0, while all of the New Jersey counties (plus Philadelphia) have affordability ratios less than 4. Three New Jersey counties have ratios either at or below the federal government’s suggested affordability ratio of 3.5.

• The reason for this is mathematically simple, if a bit economically counter-intuitive. House prices in Bucks and Montgomery counties are among the highest in the region, and so are their typical household incomes. The opposite is true of Gloucester and Salem counties. But the degree to which prices exceed incomes in the former is far greater than in the latter. Here’s why: during Covid, house prices grew by more in the region’s affluent counties than in its less affluent ones.

• Similar increases in housing unaffordability are also seen in rents. The chart above shows the median monthly apartment rent over time for each county in the Philadelphia metro area:

RENTAL REALITIES

• Since Covid began in early 2020, the level of rents has risen an average of 27% across the region. However, there has been some moderation in the last twelve months. This shows a similar pattern as house price movements.

• Philadelphia is unique among large cities for how diffuse the ownership of its rental properties is. The chart below compares the degree of ownership concentration of rental properties in Philadelphia to other major U.S. cities3

• In Philadelphia, the top 20 largest firms own only 9.1% of all multifamily (i.e. apartment) properties. This is significantly less than the approximately 40% average in other large U.S. cities (for which data was available).

• Such a significant diffusion of ownership implies that Philadelphia’s rental market is quite competitive. In theory, this implies that rental increases over time should generally be lower than those in less competitive markets like Seattle or San Francisco, since landlords in Philadelphia are less able to shift increases in costs on to their tenants.

• But, the fact that rents—like prices—have significantly increased in the multifamily segment of Philadelphia’s rental market implies that there are larger and more fundamental forces at work. That is, it is highly unlikely that significant increases in rents can be blamed upon “greedy landlords”, especially at a time when the supply of new multifamily product has been expanding significantly.

WHAT TO EXPECT:

• Going forward, almost every market indicator continues to signal short-term deceleration but longer-term increases in unaffordability. This is true both locally and nationally. The short-term culprits behind both declining sales and prices are a combination of higher interest rates, decreased housing affordability and an overall cooling economy. However, despite dire predictions from many forecasters, no major price declines have yet to occur either locally or nationally (or at least not on par with the last “housing bubble” downturn).

But, that doesn’t mean further declines won’t or can’t occur. In fact, fundamentals indicate that some further price declines are ahead. Inventories and interest rates are the key leading indicators that will determine the extent of any future declines. Lastly, keep in mind that some modest depreciation in house prices has its plus sides: it increases housing affordability (and therefore, accessibility) while restoring some rational semblance of balance between supply and demand. However, recent history indicates that even a typical cyclical price correction will have only a modest and temporary impact on both the city and region’s overall housing affordability. Local house prices fell by a whopping 23% locally during the last housing downturn, yet they are now pushing against the limits of affordability barely ten years later. Since the current correction has been much milder, expect longer-term trends to eventually resume … and probably sooner than you think.

Kevin Gillen received his Ph.D. in Applied Economics from the Wharton School at U. Penn., concentrating in urban economics and real estate finance. He is currently a Senior Research Fellow with Drexel University's Lindy Institute for Urban Innovation, as well as an Adjunct Professor of Finance with Drexel's LeBow College of Business.

CITATIONS

1. The house price index measures the change in the average house price of houses in Philadelphia, after adjusting for seasonal effects and the composition of homes that sold.

2. This includes all counties in the Philadelphia MSA, minus Philadelphia County and Cecil County, MD.

3. The “Concentration Ratio” is a commonly used industry metric to measure what percent of an industry’s market share is owned/controlled by the industry’s largest firms. It is commonly used in antitrust cases to define how competitive (vs. monopolistic or oligopolistic) an industry is. High values of the ratio indicate a relatively uncompetitive market, while low values indicate a relatively competitive one.

CHINATOWN, AFFORDABLE HOUSING, AND THE RIGHT TO THE CITY

BY CAROLINE AUNG

Chinatown is one of Philadelphia’s oldest and most vibrant neighborhoods. Beneath the neighborhood’s tourist-friendly surface is a dynamic ecosystem of immigrant workers, residents, and business-owners that make up Chinatown’s beating heart. Since 1870, Chinatown has served as a vital sanctuary and gateway for new immigrants as they establish roots in the United States. However, Chinatown has been experiencing mounting gentrification and displacement pressures from Center City, Callowhill, and Northern Liberties and developments like the Rail Park and the proposed 76ers arena. Preserving and promoting affordable residential and commercial opportunities is necessary to secure Chinatown’s long-term survival and vitality. Affordability is what allows for essential ethnic communities and networks to form, and what creates the authentic urban experience one can only find in Chinatown.

A Brief History of Chinatown

Chinatown’s roots trace back to the late 19th century, when Chinese immigrants settled around the 900 block of Race Street in what was then known as the city’s red light district. Deemed unwelcome elsewhere, Chinese immigrants gradually formed their own neighborhood, starting their own shops, groceries, and restaurants. Chinatown then consisted primarily of “bachelor’s societies,” as the men who immigrated from China were unable to bring their wives or children due to discriminatory immigration laws. With the advent of more liberal immigration policies after WWII, Chinatown transformed into a more family-oriented community, as more businesses, churches, and cultural organizations sprung up in the area.

Chinatown, in many ways, has persisted against all odds. Several large development projects have threatened to tear apart the neighborhood. However, the neighborhood is undergirded by a network of grassroots advocates who continue to fight to protect

their community. Residents and activists organized to protect their beloved Holy Redeemer Church and School from being demolished for the Vine Street Expressway in the 1960s. Since then, they have successfully defeated plans for a federal prison, baseball stadium, and casino. Today, they organize against the proposed 76ers arena for the same reasons as every time before — to prevent the cultural and physical displacement of Chinatown.

The threat of displacement looms not only in imminent large development projects but also in the changing nature of the real estate market. Correlating with the migration of young professionals into downtowns across the country, the property values in and around Chinatown have risen rapidly, with median rents increasing from $1,396 in 2018 to $1,595 in 2021 (American Census). With the naturally occurring affordability that once characterized Chinatown waning and 57% of immigrants in Chinatown making less than 30% AMI (Econsult, 2017), many residents have moved to the suburbs in Northeast Philadelphia where rents are cheaper and homeownership is more attainable. Chinatowns around the country have gone through similar processes of suburbanization (e.g. in Boston, New York, Houston, Los Angeles) in the face of unaffordable living conditions.

Affordable Housing Development in Chinatown

In the 1980s, PCDC founder Cecilia Moy Yep refused to leave her home at 9th and Race Streets, while blocks of houses around her were being destroyed by the government. The City was using emi-

The 900 Block of Race Street in Philadelphia, 1969, top. Philadelphia Chinatown street vendors, shoppers, Friendship Gate, and fashion district in the far background, right. Gim San Plaza an affordable mixed-use development built by PCDC in 1989, above.

PHOTOS: TEMPLE UNIVERSITY ARCHIVES (RIGHT), PCDC (BELOW)

PHOTO: PCDC (ABOVE)

nent domain to demolish buildings and displace Chinatown residents to make way for the Center City commuter rail. Yep, then a 32-year old widow with three children, declared to the mayor that she would leave her house voluntarily only if he promised to build more housing in Chinatown. Yep’s powerful act of resistance resulted in Chinatown receiving three publicly sponsored housing developments for seniors, low-income people, and those who had been displaced. Yep’s persistence characterizes the ethos of the Philadelphia Chinatown Development Corporation (PCDC), which she founded in 1966.

PCDC’s mission is to protect, preserve, and promote Chinatown as a viable ethnic, business, and residential community. To this end, PCDC engages in neighborhood planning projects and affordable housing development to protect the neighborhood against the forces of inequitable development and a rising real estate market. In order to build housing in Chinatown, PCDC utilizes various public funding streams and acquires City-owned land - some of which had been taken from the neighborhood by the government during the urban renewal era of the late 20th century.

PCDC’s first housing developments were completed in the early 1980s with the building of 80 townhomes on Spring and Race Streets. The goals of these developments, named Mei Wah Yuen and Wing Wah Yuen, were to preserve the residential character of Chinatown. On Lok House, completed in 1984, is located in the middle of Chinatown’s commercial corridor and continues to provide Section 8 housing for Chinatown’s elderly population. Gim San Plaza, completed in 1989, is a mixed-use development located on the Eastern edge of Chinatown that serves both tenants and small business-owners. Hing Wah Yuen and Sing Wah Yuen, completed in 1997 and 2003 respectively, provide housing for residents of low to moderate income near PCDC’s office. The Francis House of Peace or Ping’an House was developed through a partnership between PCDC and the non-profit Project Home in 2016; the nine-story building provides housing to Chinatown residents and unhoused individuals. Finally, PCDC completed the construction of the North 12th Street townhomes in 2019, which provides affordable rentals in Chinatown North.

PCDC continues to advocate for the return of land taken by eminent domain back to the Chinatown community. PCDC is currently developing a mixed-use affordable building at the vacant site at 10th and Winter Street, a parcel which had been seized from the neighborhood for the construction of the Vine Street Expressway. PCDC is also working on acquiring the land at 800 Vine Street, which had been appropriated in the 1980s for the construction of the Center City Commuter Tunnel. As Chinatown resident Margaret Chin states, the 800 Vine parcel “should stay and be developed in our community, by our community, and for our community.”

PCDC believes creating affordable homeownership opportunities is crucial to preserving Chinatown’s livability for immigrants of diverse economic backgrounds. Creating pathways to homeownership for working class residents allows them to stay and raise families in Chinatown, as well as build intergenerational economic capital. To this end, PCDC is currently developing eight affordable homeownership

Protestors against the Vine Street Expressway, top. Chinese New Year parade, above.

PHOTOS: PHILADELPHIA INQUIRER (TOP LEFT), ALBERT LEE (LEFT)

units along North 11th Street and planning to build up to 71 affordable condo units on the Western edge of Chinatown, where the current 6th district police station and parking lot are currently located.

Chinatown and the Right to the City

Despite developing 481 units of housing since its founding, PCDC’s developments cannot keep up with the pace of gentrification and displacement that is occurring in Chinatown. With around 6,000 people residing in the neighborhood, the proportion of Asian residents in the neighborhood has declined from 60% in 2000 to less than 50% in 2020 (American Census). Moreover, with a “satellite Chinatown’’ forming in the Northeast suburbs of Philadelphia, some might question whether it is the fate of Philadelphia’s Chinatown to undergo dissolution through suburbanization, a fate so many other Chinatowns in the country have faced. Others might further question whether it is worth investing significant resources in Chinatown given the scale of the issues the neighborhood faces. The following are four reasons why it is important to continue investing in the preservation of Chinatown, even as the challenges the community faces continue to grow.

First, Chinatown is worth preserving for the historical importance it holds. Philadelphia’s Chinatown is one of the oldest Chinatowns in the US and one of the last remaining Chinatowns in the United States. It is of utmost importance to preserve this part of Philadelphian and American history. Even individual buildings hold special historical relevance: for instance, Holy Redeemer Church and School at 10th and Vine Streets served as the rallying point for the community’s first collective fight against predatory development. Generations-old institutions like Holy Redeemer carry a kind of sacred value for those who have grown up in Chinatown.

Second, Chinatown must be preserved in honor of the individual lives it shapes and has shaped. One long-term resident who lives in one of PCDC’s housing developments shared that she is grateful for the opportunity to stay in Chinatown because she is able to maintain connections with people she has known her whole life. To this day, she enjoys playing basketball at the Crane Center and at the Chinese Christian Church with both the younger and older generations in the community. Her family always goes back to the same Dim Sum restaurant on Sundays, where they are good friends with the restaurant staff. She further shared that “no one who moves out of Chinatown wants to leave Chinatown.”

Thousands of lives are entangled with the Chinatown neighborhood and its ongoing evolution. Stakeholders of Chinatown’s future must act in honor of all those personal lives that Chinatown has grown to be a core part of.

Third, Chinatown is one of the few minority neighborhoods that has high access to valuable amenities and opportunities. Areas with good infrastructure, schools, and parks as well as close connections to public transit, jobs, and social services are frequently rendered inaccessible to minority groups. Chinatown is a rare exception in providing an immigrant enclave convenient access to the resources and services that one can only find in a thriving downtown area. This has allowed many immigrant families to successfully transition into American society and work their way out of poverty. In fact, decades of research demonstrate how the zip code one resides in strongly determines one’s life outcomes1 Chinatown must be preserved as this gateway of

promise and opportunity for working class immigrants looking to build a better life in the United States.

Finally, Chinatown’s people have not only significantly contributed to Philadelphia’s economy, but they have also played a key part in the social and cultural life of Philadelphia – earning them a fundamental right to remain in the city center. The everyday labor it takes to build and run the hundreds of shops, restaurants and organizations that make up Chinatown should not be diminished. Through the creativity, resourcefulness, and hard work of its members, Chinatown has provided value not only to those who reside in it but also to those in the larger Delaware Valley region. Asian Americans in particular find special significance in Chinatown, which provides a unique and profound way for them to connect to their heritage, culture, and identity.

Geographer and theorist David Harvey (2019) writes, “Only when it is understood that those who build and sustain urban life have a primary claim to that which they have produced, and that one of their claims is to the unalienated right to make a city more after their own heart’s desire, will we arrive at a politics of the urban that will make sense.” Affordable housing is a key component in securing Chinatown residents’ right to remain in the city. However, as Harvey indicates, housing is just one part of a broader vision of urban justice - one that involves a reformed urban process that is responsive and attentive to the needs and aspirations of all those who actually make up the city.

Looking Forward

Affordable housing development must be paired with new government policies to ensure neighborhoods like Chinatown continue to have a place in the urban fabric of Philadelphia. Along with promoting affordable housing development, PCDC advocates for housing policies such as inclusionary zoning (which incentivizes or mandates developers to allot a fraction of new housing to low to middle-income families); tax increment financing (which makes growth in property taxes available for affordable housing development); rental assistance programs; and rent stabilization. PCDC is also exploring the possiblity of forming a community land trust in Chinatown, as a way to protect properties from the fluctuations of the real estate market and secure their long-term affordability.

PCDC further urges all those involved in the urban-political landscape of Philadelphia to support the preservation of Chinatown through 1) spreading awareness of issues threatening Chinatown and other working class neighborhoods; 2) advocating for effective affordable housing policies; 3) supporting the work of PCDC and other grassroots organizations serving minority communities; and 4) discouraging projects and practices within and outside your workplace that threaten neighborhoods like Chinatown, while encouraging equitable development practices in your industry or field. With enough resolve and collaboration, we can work together to create a Philadelphia that meets the needs and encourages the dreams of all the diverse communities that call the city home. ■

Caroline Aung is a Community Development Project Associate at the Philadelphia Chinatown Development Corporation (PCDC), where she helps manage the organization’s neighborhood planning and development projects.

PHILADELPHIA’S PRESERVATION CHALLENGE

BY SUE MCPHEDRAN, KYLA WEISMAN BAYER, CAROLYN PLACKE, AND DANIEL SWAIN

According to The Pennsylvania Housing Finance Agency’s (PHFA) 2020 Comprehensive Housing Study, there is an unmet need for nearly 72,000 affordable housing units for Philadelphia’s low and extremely low-income households.1 This has been made even more challenging in that Philadelphia has lost roughly 24,000 unsubsidized low-cost rental apartments, or “naturally occurring affordable housing”, with rents (including utilities) less than $750 per month 2 This problem has only deepened during the COVID-19 pandemic, with almost 21% of Philadelphia landlords putting a property up for sale in 2020, a more than 600% increase than the previous year.3

The worsening affordability gap and the loss of unsubsidized units has increased the urgency of preserving the nearly 34,200 units of publicly assisted affordable rental housing in Philadelphia as these properties age and/or rental assistance contracts expire. As a general rule, residents in publicly assisted affordable rental housing pay no more than 30 percent of income toward rent.

The map to the right illustrates the magnitude of Philadelphia’s publicly assisted challenge, and the nearly 4,800 apartments owned by non-profit owners.

Preservation of Existing Publicly Assisted Affordable Rental Housing Helps Solve Housing Insecurity & Builds Strong Neighborhoods.

Where do you call home? Is it a rowhouse in South Philadelphia? A suburban home on a quiet tree-lined street? A house shared with roommates in Fishtown? A studio apartment in Center City? Imagine your circumstances change and you are no longer able to afford your own home or your rental apartment building is sold and no longer affordable — what would you do? Where would you live?

Answering this question is a very real challenge for people who lose their housing — particularly those without a safety net. More times

than not, these individuals and families are at risk for homelessness and this risk is amplified by the shortage of available affordable housing.

The statistics paint an unfortunate picture. In Pennsylvania, 14% of households are housing insecure, which has been proved to directly impact a household’s ability to thrive personally and economically, and hinders growth in our communities. In Philadelphia, nearly 8,000 households are in emergency shelters or transitional housing (Philadelphia OHS FY2021 Data Snapshot) in need of permanent supportive housing. At a time when more than 19 million households across the United States are spending more than 50% of their income on housing, expanding access to and availability of affordable housing is more important than ever.

Collaborative Approaches to Preserving Affordable Rental Housing

LISC Philadelphia is one of 38 local offices of Local Initiatives Support Corporation (LISC), a national community development intermediary and financial institution. LISC Philadelphia is the convener of the Preservation Network, a multi-sector collaborative of private, non-profit, and public sector agencies committed to preserving and protecting at-risk publicly assisted affordable rental housing in Philadelphia. LISC’s role evolved from serving as the lead consultant for the City of Philadelphia’s Housing Action Plan. vi This spring, LISC Philadelphia launched the Non-Profit Preservation Initiative (NPPI), in response to the critical needs of non-profit owners of affordable rental housing as identified through in-depth discussions with owners, analysis of past investments, and a report, “The Preservation Challenge: Projections & Policies for Maintaining Non-Profit Affordable Rental Housing in Philadelphia” ⁷ The first phase of NPPI aims to preserve 650 non-profit owned publicly assisted affordable rental units.

Non Profit Owned Housing

Mid City Apartments Meets the Need for Permanent Supportive Housing in Center City.

Mid City Apartments is part of the permanent supportive housing solution in Philadelphia. Located in a former YMCA residence originally constructed as a hotel at 2025 Chestnut Street, this apartment building has provided housing for previously homeless individuals since 1999.

In 2016, the City of Philadelphia approached Mission First requesting that it save Mid City Apartments from closure by acquiring the project from its for-profit owner. In its location, just off Rittenhouse Square, rents are 35% higher than the City-wide average and a studio apartment rents for around $2,000. This put Mid City Apartments at acute risk of conversion to market rate housing, which would result in the loss of affordable housing in Center City and displace 60 households.

To combat this risk, Mission First accepted the challenge in 2016. Now, with forward vision, it has committed to renovate the property and make it viable as permanent supportive homeless housing for the next 45 years. Mid City Apartments’ residents, the Center City Residents Association and the City of Philadelphia are supportive of the plan.

Building for Sustainability

Mission First knew that as part of the recapitalization of Mid City Apartments, a redesign was needed to support its future sustainability. It turned to CBP Architects, formerly Cecil Baker + Partners — a firm with deep experience in both Center City luxury high-rise residences and affordable rental housing — to redesign the existing structure, making Mid City Apartments as comparable as possible to other downtown residences.

The development plan eliminates all of the single-room occupancy (SRO) units with shared kitchens and in their place creates small efficiency apartments, each with its own full kitchen and bath. Existing one-bedroom apartments will be renovated, and the lobby will be reconfigured to create separate entrances for the apartments and the building’s

Local Developer Working to Preserve Affordable Housing

Mission First Housing Group — a nonprofit real estate developer whose mission is to develop and manage affordable, equitable, safe sustainable homes that support residents and strengthens communities — serves an important role in creating and preserving affordable housing in Philadelphia. Mission First is a leader in preservation, with a niche specialty in difficult projects — preserving more than 700 apartments in Philadelphia and planning to preserve 500 more in the next five years. For nearly 35 years, Mission First has successfully preserved affordable housing in cooperation with lenders, investors and community partners, all the while helping to stabilize neighborhoods, keeping people in their homes and housing some of the City’s most vulnerable.

“

It was critical to Mission First that we maintain as many units as possible as we transitioned from the single room occupancy model to the efficiency units. We also needed a solution that was as cost effective as possible. We devised a plan that takes three contiguous SRO units and converts them to two efficiencies. Doing this allows us to keep and reuse two of the existing bathrooms with new fixtures and finishes provided. Many demising partitions will remain. This approach provides both efficiency in construction and controls costs, maintains the maximum number of overall dwelling units, and eliminates difficult to manage shared spaces.”

— Nancy Bastian, AIA, Managing Partner of CBP Architects

other use. All building systems, fixtures and finishes will be replaced and security enhanced with the addition of cameras and fobbed entry to the building, elevator and apartments.

Nancy Bastian, AIA, Managing Partner of CBP Architects notes, “It was critical to Mission First that we maintain as many units as possible as we transitioned from the single room occupancy model to the efficiency units. We also needed a solution that was as cost effective as possible. We devised a plan that takes three contiguous SRO units and converts them to two efficiencies. Doing this allows us to keep and reuse two of the existing bathrooms with new

fixtures and finishes provided. Many demising partitions will remain. This approach provides both efficiency in construction and controls costs, maintains the maximum number of overall dwelling units, and eliminates difficult to manage shared spaces.”

A Complex Financial Structure

Preservation of Mid City as affordable housing involves a myriad of partners as part of a complex financing structure that supports needed renovations and provides sufficient funds for operations over the long term. Philadelphia LISC provided key early stage pre-development resources to support Mission First’s efforts to determine whether the recapitalization/redevelopment strategy was feasible.

Local, state and federal government agencies are involved in providing resources for Mid City Apartments, including rent support from HUD’s Rental Assistance Demonstration program, a “soft” loan from the Philadelphia Housing Development Corporation, and Low Income Housing Tax Credits and a “soft” loan from the Pennsylvania Housing Finance Agency. The Federal Home Loan Bank of New York is providing a $2 million grant. In the end, Mission First has pulled together a complex financing structure with 11 separate funding sources totaling $19 million of investment for the preservation of Mid City Apartments.

“Preserving Mid City Apartments in such an amenity-rich neighborhood speaks to the core of our mission and commitment to ensuring that everyone has a safe place to call home,” said Sue McPhedran, Director of Development for Mission First Housing Group. “Our development and design partners understand the importance of housing preservation and sustainability that supports our residents and the communities we serve.”

Developing a multi-faceted strategy that preserves existing publicly assisted affordable rental housing, amidst the need for

new units and diminishing public resources, is at the heart of the Philadelphia’s preservation challenge. This challenge is all the more acute in neighborhoods experiencing the displacement of residents by rising rents and loss of affordable units.

Non-profit owned properties moving towards expiration of their affordability restrictions face complex challenges. Property owners will need new financing, including new Low Income Housing Tax Credit (LIHTC) awards and “soft” loans from public agencies to replace obsolete systems, make energy efficiency upgrades, and modernize apartments. Without adequate funding, owners may need to opt out of rental assistance programs, convert to market-rate housing, or sell properties.

Despite such challenges, preserving existing affordable housing is often less expensive than building new, helps protect previous public investments4 ,5 and preserves the opportunity for those most vulnerable to live in clean, modern and affordable homes.

Sue McPhedran is the Director of Development for the Philadelphia Region, Mission First Housing Group. Kyla Weisman Bayer is Senior Development Project Manager for Mission First Housing Group. Carolyn Placke is the Senior Program Officer for LISC Philadelphia. Daniel Swain is Assistant Program Officer for LISC Philadelphia.

For more information about Mission First Housing Group, go to www.missionfirsthousing.org. For more information about LISC, go to www.lisc.org

CITATIONS

1. “Pennsylvania Comprehensive Housing Study: County Profiles.” The Pennsylvania Housing Finance Agency, May 2020. pp 52. Available At: https://www.phfa.org/forms/housing_study/2020/county-profiles.pdf

2. “Gentrification and Changes in the Stock of Low-Cost Rental Housing in Philadelphia, 2000 to 2014,” p. 2; Seth Chizeck (January 2017) Available At: https://www.philadelphiafed.org/-/media/communitydevelopment/publications/cascade-focus/gentrification-andchanges-in-the-stock-of-low-cost-rental-housing/cascade-focus_5. pdf?la=en

3. “How Are Landlords Faring During the COVID-19 Pandemic?” Elijah de La Campa, Vincent J. Reina, Christopher Herbert. August 2021. pp. 32. Available at: https://www.jchs.harvard.edu/sites/default/files/ research/files/harvard_jchs_covid_impact_landlords_survey_de_la_ campa_2021.pdf

4. “Preserving Affordable Rental Housing: A Snapshot of Growing Need, Current Threats, and Innovative Solutions” (Summer 2013) Available At: https://www.huduser.gov/portal/periodicals/em/ summer13/highlight1.html

5. “Preserving and Expanding The Supply of Affordable Rental Housing: Reforming Policies, Practices and Capital and Building Trust” (April 2021). Available At: https://www.urban.org/sites/default/files/ publication/104192/preserving-and-expanding-the-supply-ofaffordable-rental-housing_1.pdf

6. City of Philadelphia, “Housing for Equity: An Action Plan for Philadelphia” Available At: https://www.phila.gov/documents/housing-forequity-an-action-plan-for-philadelphia/

7. “The Preservation Challenge: Projections & Policies for Maintaining Non-Profit Affordable Rental Housing in Philadelphia,” (August 2022) Available At: https://www.lisc.org/media/filer_public/22/df/22df016a553a-48e4-aae3-8fa3e3b06a8f/the_preservation_challenge_-_ projections_and_policies_for_maintaining_non-profit_affordable_ rental_housing_in_philadelphia_-_lisc_philadelphia_august_2022_2.pdf

AFFORDING AFFORDABILITY IN PHILADELPHIA

BY DAVID LANGLIEB

The evolution of Philadelphia’s built environment and its economic history are helpful for understanding today’s affordable housing challenges. Two circumstances in particular distinguished 18th and 19th century Philadelphia from its early American peer cities – first, the city drew a disproportionate number of skilled craftspeople escaping religious oppression. Second, its geographic proximity to the commonwealth’s extraordinarily rich and varied portfolio of natural resources – ultimately linked by canals and railroads – helped put these early immigrants and future generations of Philadelphians to work.

These occurrences are why the city became known as ‘Workshop of the World’ during the industrial era and well into the 20th century, with an economy concentrated in specialized manufacturing of higher end, finished goods. At its post-war demographic peak in the early 1950s, 45 percent of Philadelphia’s employment was in manufacturing. Comparatively, New York City peaked at just under 33 percent and Boston at approximately 19 percent. The predominance of specialized, skilled manufacturing in Philadelphia built a middle class with high rates of homeownership.

Of course, the rise and fall of American manufacturing over the last several decades is news to no one; what is atypical about Philadelphia is the degree to which skilled, neighborhood-based manufacturing shaped its growth and how disproportionately reliant the city became on these jobs. Being Workshop to the World helped create an extraordinary city, but left Philadelphia especially vulnerable to a more permanent shift away from its manufacturing base once the economic headwinds grew too stiff. Today, Philadelphia is the poorest of the 25 largest cities in the country. While considerable work has been done to transform the city’s jobs base, the trajectory of local employment has tended towards economic inequality – employment growth in recent years has been concentrated in hourly wage service sector jobs and higher salaried positions in the meds and eds.

This dynamic presents a diabolical problem from the perspective of quality affordable housing in Philadelphia. In essence, what we have is a city built for the middle class being retrofit for low-in-

come and high-income households at the same time. This is why we see $750,000 rowhomes with Viking ranges and roof decks across the street from rundown rental properties managed by absentee landlords. The former portends gentrification, and the latter imperils and exploits tenants.

To the credit of many stakeholders both inside and outside city government, there has been a strategic focus on making quality affordable housing economically viable. The city’s 2018 Housing Action Plan contained several excellent recommendations, including the creation of a new loan fund aimed at investing in affordable housing. This ultimately came to fruition, and I was brought on last year as full-time executive director of the Philadelphia Accelerator Fund (PAF). While we are still a small organization, we have tools at our disposal which were designed to pull residential development activity within the city towards quality affordable housing.

Quality affordable housing is broadly beneficial if properly developed. First, it meets the immediate need of sheltering city residents who lack access to safe, comfortable accommodations. At the same time, it helps build generational wealth among homeowners, particularly Black households overcoming ancestral discrimination by the Home Owners’ Loan Corporation and the Federal Housing Authority. Even affordable rental housing helps households build generational wealth, as a family spending 6070% of pretax income on rent will have a nearly impossible time getting ahead.

There are several non-profits doing affordable housing lending in the city, but there had not, until PAF, been an organization exclusively committed to affordable housing finance in Philadelphia with a focus on financing small developers. Black and brown owned development firms are a specific focus of the fund, and we are especially inclined to finance developers building affordable housing in their own communities. Critically, our capital can do almost anything, including predevelopment debt, acquisition debt, and mezzanine debt structured to de-risk a transaction for a senior lender. This enables us to be nimble and project-specific in a market where that matters.

IN ESSENCE, WHAT WE HAVE IS A CITY BUILT FOR THE MIDDLE CLASS BEING RETROFIT FOR LOW-INCOME AND HIGHINCOME HOUSEHOLDS AT THE SAME TIME.

For starters, our financing can be used for ground-up construction on vacant property, which currently constitutes around 12% of the city’s land. A portion of this property is owned by the city Land Bank, which is positioned to sell land at nominal cost for community-based affordable development projects. For Land Bank dispositions, PAF provides financing to developers who lack access to bank debt and who are willing to meet a threshold level of deed-restricted affordability. Small developers, especially ones who are investing in their own communities, are a particular focus. Many employ local residents, returning citizens, and at-risk youth from the communities in which they build.

For private transactions, PAF serves as a low-cost alternative to hard money lenders who squeeze the profit out of small projects. PAF debt is priced roughly in line with bank debt, with rates a point or so above what wealthy developers with access to traditional credit typically pay. These kinds of transactions, even if they only finance the rehab of a couple single family shells, also help small developers ‘scale up’ their activities and build their personal balance sheet. We need legions of local developers to do this work and wherever possible we use our financing to help them grow.

For projects with exceptional levels of affordability which have either secured the necessary subsidy (Low Income Housing Tax Credits, for example) or are in the process of securing subsidy, PAF provides the “but for” financing sufficient to make the deal pencil. This is generally predevelopment financing, which is the first money into a deal and carries the most significant lender risk. The hyper-local focus of PAF makes us acutely aware of where these predevelopment dollars are most effectively deployed.

No single initiative can reverse decades of disinvestment and rebuild Philadelphia’s middle class. But within the framework of this complex generational project, quality affordable housing built by local developers gets us an exceptionally strong return on investment. PAF prioritizes those investments, figuring out where our financing fits on a project-by-project basis and helping to build all the quality affordable housing we can.

David Langlieb is the Executive Director of the Philadelphia Accelerator Fund. He previously served as Senior Underwriter for New Jersey Community Capital and was Vice President of Business Lending with the Philadelphia Industrial Development Corporation

Exterior of High Victorian style 4124-28 Parkside Avenue. The Philadelphia Accelerator Fund provided a $1.3 million mezzanine loan enabling Fine Print Construction to restore the gutted interior and complete 17 rental apartments, nine of which are deed-restricted as affordable.

DESIGN PROFILE

PROJECT: St. Rita Place & Cascia Center

LOCATION: Philadelphia, PA

CLIENT: Catholic Housing & Community Services

PROJECT SIZE: 53,000 sf

PROJECT TEAM:

CBP Architects (Architect)

Boles Smyth (Civil Engineer)

Keast & Hood Co. (Structural Engineer)

Holstein White (MEP Engineer)

BEAM, Ltd. (Lighting Designer)

Domus, Inc. (General Contractor)

ST. RITA PLACE & CASCIA CENTER CBP Architects

For many years the site for St. Rita Place & Cascia Center was a vacant lot located along Broad Street in South Philadelphia. This prominent corner location has now been transformed with a new, five-story, mixed-use structure that serves the adjacent St. Rita of Cascia Church & Shrine and the neighborhood beyond by providing both affordable housing for seniors as well as a center for peace and reconciliation. Developed by Catholic Housing & Community Services, this project was funded through the low-income housing tax credit program and provides 46 one-bedroom units for seniors, many of whom have lived in this neighborhood their entire lives. The Cascia Center occupies 7,500 sf at the first floor and serves several purposes including providing a

gathering place for pilgrims visiting the Shrine next door, as well as a place where those in conflict can come together seeking resolution. In siting the new building, the main structure sits tight along Broad and Ellsworth Streets, opening to a newly created Plaza located between the new building and the adjacent, early 20th-century limestone church. St. Rita Place provides permanent housing for low-income seniors in a prominent location adjacent to a beloved neighborhood landmark. In addition, the Cascia Center will become a safe place for the community where conflict can be safely mediated. These two uses come together in a vibrant, mixed-use building that celebrates and inspires those who live, work, and gather here. ■

DESIGN PROFILE

GLORIA CASAREZ RESIDENCE Thriven Design

The first of its kind in Pennsylvania, and among the first of its kind nationwide, Project HOME’s Gloria Casarez Residence provides LGBTQ-friendly housing for at-risk young adults who are aging out of foster care, are formerly homeless, or at-risk of becoming homeless. Approximately 40 percent of homeless young adults identify as LGBTQ, and the Gloria Casarez Residence honors the legacy of civil rights leader and LGBTQ activist Gloria Casarez by providing supportive housing and resources designed to help residents aged 18 to 24 achieve their long-term goals of permanent housing, education, and employment. Thriven Design provided architecture, interior design, mechanical, electrical, plumbing, and fire protection engineering services for the project, which transformed an underused 0.65-acre parking lot into a 30-bedroom, four-story supportive residence.

Thriven Design also provided energy program administration for the Gloria Casarez Residence, which is LEED certified. Each secure, private one-bedroom apartment in the Gloria Casarez Residence includes a living area, full-size eat-in kitchen, bedroom, bathroom, and storage space. Shared amenities for the site include on-site management office, residential services suite with computer area, mailroom, laundry room, exercise room, maintenance storage, bike storage room, and a large community room with kitchenette. Out-

door features include a private courtyard and greenspace, parking lot, and a south-facing roof deck. The site is adjacent to single-family rowhomes on the north and east sides, with scattered commercial uses nearby. Temple University’s campus is within walking distance to the site, as are multiple transit options, providing residents with access to employment opportunities and community resources citywide. In 2019, construction began on an expansion to the Gloria Casarez Residence, a second adjoining affordable supportive community: Peg’s Place. Thriven Design provided architecture, engineering, and interior design services for this phase, as well, which was completed in September, 2021. ■

PROJECT: Gloria Casarez Residence

LOCATION: Philadelphia, PA

CLIENT: Project HOME

PROJECT SIZE: 36,547 sf

PROJECT TEAM:

Thriven Design (Architect, HVAC Engineer, Plumbing Engineer, Fire Protection Engineer, LEED Administration)

Innova Services (Enterprise Green Communities Administration )

Eustace Engineering (Civil Engineer)

MPP Engineers, LLC (Structural Engineer)

Environmental Consulting, Inc. (Environmental Engineer)

Convergint Technologies (Security Consulting)

Earth Engineering, Inc. (Geothermal Engineer)

Domus Inc. (General Contractor)

OXFORD GREEN ISA Architects

The Oxford Green development is the largest, greenest project todate by the Philadelphia chapter of Habitat for Humanity. Sited in Sharswood, the project provides homeownership opportunities for 20 low-income families through HfH’s unique community building model. While HfH historically has been known for its single-family suburban detached houses, Oxford Green’s higher density attached model provides enhanced sustainability, efficiency and livability for residents. Sited on a former PHA superblock, Oxford Green plays a crucial role in reconnecting the site to the surrounding neighborhood. New streets were built or reactivated after decades of closure, and multiple developers were assigned pieces of the larger parcel. With Oxford Green, HfH piloted a restoration back to traditional rowhouse fabric, with two-story attached rowhomes lining two blocks on the south side of Oxford Street to complete the long-interrupted urban edge. Each house faces the street with an entry door and stoop, manages stormwater onsite with a green

roof, and provides an ample fenced rear yard for safe, private social events and play. The homes are spatially, economically and energy efficient, maximizing homeowner value while minimizing cost of living. Analysis of past HfH layouts resulted in crucial adjustments to rationalize framing and MEP systems and enhance access to natural light. Three bedrooms and one bathroom stack above an open living space with central kitchen and powder room designed to accommodate future homeowner improvements and multi-generational households while incorporating donated fixtures and finishes. A contemporary response to color and materiality references the context with a palette of red and beige fiber-cement lap siding and corrugated metal panels that was affordable, procurable and easily installed by local construction crews and volunteers. The design approach reinforced HfH’s mission while maintaining a sensitive approach to the organization’s unique structure and serving as a key design prototype for its future growth. ■

PROJECT: Oxford Green

LOCATION: Philadelphia, PA

CLIENT: Habitat for Humanity Philadelphia

PROJECT SIZE: 34,500 sf

PROJECT TEAM:

ISA Architects (Architect)

Studio Sustena (Landscape Architect)

Cornerstone Consulting Engineers (Civil Engineer)

Cornerstone Consulting Engineers (Civil Engineer)

Larsen & Landis Structural Engineers (Structural Engineer)

Stephen Wayland (MEP Engineer)

Habitat for Humanity (General Contractor)

DESIGN PROFILE