Un iversity City District’s Market Trends Report for Summer 2019 supplements our comprehensive State of University City publication released each fall. The UCD Market Trends Report captures the latest information on announced and completed projects, commercial transactions, retail leases, and housing market trends. We strive to provide exclusive access to critical, actionable, and timely market data for UCD’s closest partners and supporters.
In the same year they are celebrating their 45th anniversary, the Philadelphia Ronald McDonald House has completed work on their massive expansion that has more than doubled their capacity to serve families in need of temporary housing while children undergo treatment at nearby hospitals. The Room in Our Hearts expansion campaign has grown the organization’s capacity from 45 to 127 rooms at the Chestnut Street house, and modernized and expanded common facilities to more than double the number of families served each year. The project also includes a new green roof, new courtyard, and an outdoor dining area.
Drexel Square - the 1.3-acre park that marks the kick-off of Brandywine Realty Trust and Drexel University’s ambitious Schuylkill Yards development - officially opened to the public in June. Designed by West 8 and SHoP Architects, the $14.3 million park is a place for people to gather, rest, and be renewed by the natural world. Conceived as an intimate, natural space within the urban environment, Drexel Square provides a clear transition from the city to a lush enclave, with 23 Dawn Redwood trees standing more than 25 feet tall lining the perimeter. Next up for Schuylkill Yards is the anticipated 2020 completion of the $43.4 million re-imagination of the Bulletin Building, and breaking ground on the recently unveiled East and West Towers at 3001 and 3025 JFK Boulevard.
The University of Pennsylvania has made significant progress on two projects located on 40 th Street. The New College House West at 40 th & Walnut Streets is beginning to rise after a summer of excavation. This 250,000 GSF residential building will be designed specifically as an undergraduate college house, part of Penn’s residential system of shared communities. The estimated completion date is Summer 2021, and the project will target LEED Silver.
Just north on the northeast corner of 40 th and Sansom, construction is progressing on Tangen Hall, the seven story, 68,000 square foot mixed-use Wharton building. Tangen Hall will include co-working and collaboration spaces, a VR environment, maker spaces, pop-up retail space for concepts conceived by Wharton students, and a Venture Lab. The building will also house the master’s level Integrated Product Design Program jointly operated by Wharton, the School of Engineering and Applied Science, and the Stuart Weitzman School of Design. The university is targeting a Fall 2020 date for completion.
After University City office vacancy rates saw slight increases for the first time in many years at the end of 2018, rates have stabilized at 10.6% vacancy at the end of Q2 (2019). Although higher than the typical average for the neighborhood for the past decade, these vacancy rates are still much lower than the region and Center City. The average asking rent saw an uptick from Q4 of 2018, from $38.95/sq. ft. to $39.02. More inventory is on the way with upcoming groundbreakings planned for buildings in Schuylkill Yards and 3.0 University Place.
The retail market remained hot in the first portion of 2019, with the addition of national brands and much needed amenities opening through the neighborhood.
Giant Heirloom Market, the second location in Philadelphia for the small-format concept from the supermarket chain, opened in July at 3401 Chestnut Street. The 9,950 squarefoot store includes fresh local produce, grab-and-go meals, plant-based foods, a large gluten-free section, and Philadelphia-area food products. Post Brothers’ redevelopment of Hamilton Court’s retail offerings is nearly complete with the official opening of Korean fried chicken chain Bonchon and boba drinks and Asian nibbles at Tea Do. Twelve stories above street level at Cira Green, Brandywine Realty opened Sunset Social, a stand offering a menu of American eats like burgers and fries plus blended drinks, beer, and wine. Additionally, University City gained a Panera Bread at 40 th and Walnut, and new Mexican restaurant Don Barriga opened to much fanfare at 4443 Spruce Street.
The Board & Brew, a new restaurant, bar, and board game café, is set to open at 32nd and Chestnut Streets in the former CoZara space. Board game cafés are gaining popularity in the city after the success of Thirsty Dice in the Fairmount neighborhood, and The Board & Brew will be the first such concept in University City to offer gaming together with food and a bar.
Rental prices currently listed on Zillow have seen an increase since our last report, up from $1,500 a month for all units (from studio apartments to whole house rentals) to $1,720. This increase is less indicative of a larger trend, and more a result of several luxury units being pre-leased before their official opening. As we’ve seen in the past, the highest median rents (currently $2,600) are luxury units in Central University City, and the lowest rates can be found in Garden Court (median $1,100 right now).
The number of home sales in the district remained fairly steady with the trends of recent years, as have the median sale prices after peaking in 2018. The highest-priced sales of Q2 in 2019 were seen in Spruce Hill and Cedar Park along Baltimore Avenue, while the lowest-priced sales came in West Powelton. Homes are still averaging less than a month on the market before selling, indicative of a continuing hot market for the neighborhood as a whole.
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University City District (UCD) was founded in 1997 by a partnership of worldrenowned anchor institutions, small businesses and residents to improve economic vitality and quality of life in Philadelphia's University City. Our primary mission is community revitalization. We work within a place-based, data-driven framework to invest in world-class public spaces, address crime and public safety, bring life to commercial corridors, connect low-income residents to careers, and promote job growth and innovation.
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For more information about UCD’s Membership Program: Contact Morgan Rogers Burns, Development Manager at 215.243.0555 x247 or morgan@universitycity.org.