The developer of One Water Street, PMC Property Group,
took the Kenney administration by surprise recently when it asked to be
released from an inclusionary housing deal that it cut with the city in 2014.
In exchange for a promise to incorporate the below-market rentals into the
250-unit building, the city gave PMC a 48-foot height bonus, allowing the
developer to add nearly five floors - and 30 full-priced units - to the design.
Because the apartment house, which towers 190 feet over
the Delaware River next to the Ben Franklin Bridge, is virtually finished, the
proposed change has put the city in a bind.
The news that PMC was seeking to renege on its affordable
housing obligation, first reported on Friday, sparked dozens of outraged
comments on local social media sites. Market-rate one-bedroom units would start
at $1,795 per month. Subsidized units would go for about half that.
Seeking to clarify the city's position, David Perri, who
heads the Department of Licenses and Inspections, said Monday that PMC would be
excused from the low-income housing deal only if it could provide other
amenities of equal value to compensate for the 48-foot height bonus.
Under the waterfront zoning rules, PMC could potentially
gain 24 feet for ground-floor retail and 12 feet for public art.
PMC officials declined Monday to discuss their request to
alter the bonus agreement, and have given no explanation for their last-minute
change of heart.
While such bonus deals are typically arranged before
construction starts, a retroactive swap is not illegal. But to make the
changes, the developer would have to start the zoning process from scratch.
"They're going to have to apply for a permit all
over again," Perri said.
That means One Water Street will have to undergo public
hearings with full-dress presentations to the Planning Commission and the Civic
Design Review board. While that lengthy process is playing out, Perri said, no
certificate of occupancy will be issued for One Water Street. The
white-and-orange-plaid building could sit empty for months.
But the decision to abandon the 25 subsidized units for
low-income residents has already incensed city's affordable housing advocates.
Beth McConnell, policy director for the Philadelphia
Association of Community Development Corporations, said that if the city gives
in to PMC's request, "we'll see more developers using this excuse to
renege on their commitments."
The high-rise development at Second and Race Streets
called the Bridge, scheduled to be completed next year, also received a height
bonus for affordable housing.
On Monday, McConnell's group sent a strongly worded
letter to Mayor Kenney, urging him not to compromise with PMC unless it agrees
to make a substantial payment to the Housing Trust Fund, which provides
construction financing for low-income housing. That payment, she suggested,
could run as high as $5 million - $200,000 for each of the 25 subsidized units.
One Water Street is not merely the first project
constructed on the central Delaware since the city completed its waterfront
master plan. It is the first project to take advantage of the inclusionary
housing law adopted as part of Nutter-era zoning code reform. The provision was
created to encourage the construction of affordable housing in gentrifying
neighborhoods.
"The clearly stated objective of the Mixed Income
Housing ordinance is to increase the supply of housing available to moderate-
or lower-income Philadelphians," the letter from the community development
association argued. It noted that PMC would save more than $400,000 a year
under the city's 10-year property tax abatement.
"PMC is getting a very good deal from the city and
should be held to its promises," the letter argued.
Source: Philly.com
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