Foot Traffic is the Key to Cities Survival
As cities continue to come back from the pandemic, Center City Philadelphia is trying to track the foot traffic in relation to pre-pandemic 2019. Their recent study shows that it is about 77 percent of what would have been considered normal before Covid-19.
That number has been bolstered by the return of office workers with a three-day regiment sometime after January 2022. The highest activity has been Tuesday, Wednesday, and Thursday when office workers from Comcast Towers returned. My wife works at Temple and is on a four-day shift, so I know that in some situations that companies varied how the return of office workers was to be implemented.
Retail occupancy has increased to about 80.5 percent, which is a plus for landlords with office vacancies on the upper floors. Gone are the Gaps, Banana Republics, the Aldo, Talbots, and Ann Taylors of the world. As these national retailers pulled out of center city, there have been opportunities opened up for local people.
The Center City District identified many businesses as "digitally native brands.” These businesses were online based in Philly and have decided to secure a physical storefront. Many of those new businesses are clothing concepts that were hit online and, in most cases, have a purchaser following. I would suppose enough of a following that they could take advantage of a distressed retail rental market.
The report also outlines that entertainment concepts are being tried and will attempt to fill in where appropriate. In addition, I am sure there are many commercial kitchens available in the center city ground floor retail inventory so there will not need to be a great upfront investment utilizing the fully equipped rental.
As I found out when I managed the South Street District, there is a lot of neighborhood interaction because of the high-density housing in the city. People use downtown for everyday goods and services. I have not seen the number of businesses that went out of business. Still, I would suppose other than hospitality, most businesses heavily relied on office foot traffic.
I know some offices have rearranged functions in the existing space, even though the office employees are back, and they do not need as much space. As these leases end, there will be another wave of downsizing office space. This will put more pressure on retail leasing and the development of alternate uses for some of the buildings. There will be a transition period, but with interest rates are rising, I am unsure how long it will take to have the space transformed to productive use. There could be changes from office to residential, perhaps an upper floor ground-breaking entertainment use, or storage facilities.
In the report, there was no reflection concerning the violence in the city. The violence in the commercial area is big news reported nationally. Still, when you look at a case like Pennsylvania Rep. Mary Gay Scanlon being carjacked at gunpoint in FDR Park, you are talking about Southwest Philly. My wife’s texts concerning shootings and violence near Temple indicate that many violent incidents are in residential neighborhoods.
The Center City District has boosted security, but most of that is related to break-ins of businesses. Throwing a rock through a window and grabbing the cash registers or some sophisticated scheme seems more prevalent than gun crime.
With the notable exception of the South Street shootings, most gun crime appears in North Philadelphia and Southwest Philadelphia. Both of these areas have hyper-segregation of low-income and minorities. Real Estate redlining and steering have clustered all poor people and minorities in their own sections. Clustering many people with little or no money in one area is not a good practice. The people living in downtown center city have more resources than those living in a high-poverty area. Whether it is access to food or availability of services, it is better to live in Center City than it is to live in North Philly.
I am sure there are good aspects of North and Southwest Philadelphia but people are being shot at recreation centers and schools. Gun violence in these neighborhoods does not provide an amenity for residents, but instead, makes them dangerous.
There is a need de-cluster low-income people. There is a need to de-cluster minorities, and instead, we continue to enact policies that appease people of color and low-income people with some relief for the fact they have to live in a hell hole. Sophisticated Tax Credit programs make the developer have increased density in an already too-dense minority/low-income area. To secure the credits, you must create a real estate deal with no market value.
The answer is to move the minorities and low-income individuals to other locations where other low-income people do not surround them. If you wake up in the morning and are black and walk around your neighborhood, as the normal course of business, and see no white people… or if you are white and see no people of color, you have a problem with the make-up of your neighborhood. If you live in Center City, Philadelphia, you see both.
I do not view Center City Philadelphia as a dangerous place and I would hope that the move toward remote work could be mitigated in a proper manner. The staff at the Center City District is taking an active role in an attempt to restore some semblance of normality, and appears to be making a difference.
Barry Cassidy is a freelance grant and economic development consultant. He can be reached at email@example.com.