State of Center City, 2011
The story of the last 20 years is a tale of successful diversification
It is the story of a 9-5 business district
Whose public environment was in disarray in 1990
1991: created a private-sector-led BID to turn this
Text Text Into this
Today: 69% of survey respondents Say Center City “much cleaner” than rest of the city
1 And with a uniformed presence of CSRs
Working in partnership with police Substantial long-term trend: 1993-2010 <ul><li>45%  drop in major crime in CCD </li></u...
81% feel safe “most of the time” or “always” When in Center City
Clean & safe was the foundation on which we built a 24-hour downtown
1992: investments in arts & entertainment
Today: 3 rd  nationally non-profit arts & culture organizations per 100,000 downtown residents
New attractions continue to open National Museum of American Jewish History
President’s House
The Barnes Foundation: opening in early 2012
Several other major projects in the pipeline
PAFA’s new pedestrian plaza linking  The expanded Convention Center to the Parkway
Original public investment Pennsylvania Convention Center 1993: We entered the hospitality industry
Prompted a 95% increase in hotel rooms
Generating significant private investment  That adapted & reused vacant, historic buildings
Nearly all within 15 minute walk
Of a Center that has just doubled in size Successfully marketed by PCVB
2001: New Independence Visitors Center
2002: New home for Liberty Bell
#1  &  #2 most visited destinations in the city
94% increase in occupied hotel room-nights
42% of expenditures of hotel guests Spent outside hotel on shopping & dining GPTMC
328% growth in fine dining restaurants 278 65 in 1992
Even in last five years, through recession 31% increase in all types of food establishments
Total number of vacancies in all retail categories Steadily declined
Flourishing of sidewalk cafes
1995 = zero
2010: 213 outdoor cafes
Outdoor cafes:  vote of confidence in quality of public spaces
Downtown that is clean & safe
Visitor- friendly: 683 pedestrian maps & signs
Integrated with 233 signs for motorist that the CCD also maintains
741 trees; 96 planters
. 1 Doubled nighttime illumination 2,046 pedestrian-scale lights
Covering  2/3 of all streets in CCD
Supporting & fostering the evening economy
Speciality lighting to animate public spaces 3 JFK underpasses
Create more destinations within downtown
Even in recession 60% say atmosphere  “ somewhat” to “much better” than last year
1996: Residential success story Turning on the Lights Upstairs   4.5 million sf. Vacant Class “C” office space <ul><li>Ret...
1998–2010: 171 buildings of all sizes Converted to residential use
Since 1997 added 12,632 new units of housing
27% increase in downtown population since 1990 93,074 residents; helped propel citywide growth Third largest residential d...
Diversification of CBD land-use 22,000 residents now living inside CCD boundaries   22,000 71,000 surrounding
Steady outward growth of boundaries of downtown
43% residents: Girard to Tasker work downtown
Education levels have increased dramatically
In the “knowledge economy”  exactly the employees that  firms want
Household income increased 106% since 1990 5.3% per year
More purchasing power for both housing & retail; $491 million within 30 minute walk of City Hall
Higher levels of education yield  broader dividends A 10% increase in the share of a region’s residents with a college deg...
Increase education level of Philadelphia residents 14.6%  9.7%  5.2%  2.3%
Downtown accounts for 39% of jobs; 43% wages
Because we have an integrated transit system 309,256 riders/day take transit into downtown
20% of city residents living outside downtown;  earn $3.5 billion annually working in Center City 12.7% = $1.5 b 10.1% = $...
89% increase Latino population since 1990 Population 1990 2000 2009 Mexican 3,276 6,220 14,450 % tot. pop. 0.2% 0.4% 0.9% ...
Three clusters of employment; Account for ½ of jobs in Mexican population Mexicans     Agriculture 4.91 Mining 8.99 Constr...
How has Philadelphia fared in the recession?
Housing production dropped dramatically for condos & single family houses
Demand for rental remains strong
Average daily hotel room rates have declined
Expansion complete; 2,000 room shortage Room rates are rebounding
Office occupancy rates have declined
But in general, most CBD office districts have outperformed their suburbs. Philadelphia: #2 behind Houston is holding occu...
 
Trends in health-care all positive:  In-patient admissions downtown hospitals up 21% since 2001
Revenues at Center City hospitals are up  +19%
NIH grant revenues are up  Thomas Jefferson University received over $75 million in grant money from the National Institu...
Colleges & universities continue to grow 32,865   students downtown;  104,975  adjacent
Freshman applications risen 87.5% since 2002
58% of seniors are “somewhat” to “very likely” to stay after graduation Campus Philly survey
24% major in health services ; 21% major in visual & performing arts
Eds & meds employment is up 17% in last decade
This has been our primary buffer against recession
Density + accessibility are a second factor
4 th  most concentrated CBD for private sector jobs
3 rd  in total number private sector jobs downtown Accessible by transit  as fuel costs rise
  #1 nationally: walk to work 35% walk; 24% public transit = 59% commute without a car
2 nd  best  in cumulative decline in house prices from peak Citywide
270% increase in value since 1990
So while Philadelphia lost jobs in the recession
Outperformed the region; staying even with nation
Assessment trends 1991-2011:  CCD assessments: diversification pays off
  Balanced mix: office, health care, education, arts, entertainment, hospitality, restaurants, retail & residential Sector...
What are challenges & opportunties in front of us?
Office employment has steadily declined Even during periods of economic expansion
By contrast, it has grown modestly in the suburbs
Less occupied office space than 20 years ago
Rents have been static for decades & can not support new construction
Philadelphia’s concentration in eds & meds A buffer than conceals a potential weakness; Dependency on a sector that is vul...
Philadelphia’s share is double national average of 18% in education & health
Much higher than east coast peers over-concentration in one sector could put us at risk
Center City is more diversified, we need to keep it that way. Create spin-off industries, commercial application of resear...
We need to end this pattern of divergence
Worth recalling Mayor’s Force recommendations
<ul><li>The debate should not be limited to ………… </li></ul><ul><ul><li>Whether we restart wage & business tax reduction </...
<ul><li>Restructuring & realigning  what  we tax </li></ul><ul><li>Because we tax the wrong things </li></ul><ul><ul><li>T...
64% of local tax revenue comes from taxing  highly mobile wages & profits PICA 55%
If you tax it (and it’s mobile), it will go
It was hard to move an assembly line Or a Baldwin Locomotive
Laptops and cell phones are far more portable
#1: We need a tax policy for a post-industrial city
Move quickly To capture the next cycle of growth in the city
#2: Invest in infrastructure; not just streetscape
We are very proud that $23.7 in CCD funds leveraged $22 million = $55.7 in public area improvements
(a) But we need bigger investments that enhance  the competitive position of the region
700 daily flights to 86 domestic cities 39 international destinations Extend reach of the International airport: Within 2 ...
By expanding runway capacity
Strengthen our position on AMTRAK NE Corridor
68  minutes to NYC 95  minutes to Washington, D.C. Increasing speed & capacity of Acela trains 2 more cars/train = 40% inc...
Preserve & capitalize on national commitment high speed rail 38 minutes to NYC; 67 minutes to Washington DC
HSR stopping both in Center City & PHL Airport Make downtown competitive with Jersey City & Hoboken
(b) Invest to reinforce major employment nodes
Downtown accounts for 39% of jobs; 43% wages
National Institute of Health (NIH) Research Funds: 2007 University City: 53% of NIH Research dollars
Vision: Front - 40 th : one continuous business district Regional center of transit-oriented development
 
Invest to connect city’s two largest   employment & research nodes: 51% of jobs
  Link Center City to University City
Fill the gap between the end of the office district..
… and Drexel’s plans to come east
Make it easier for Jerry to walk between his holdings
Enhance transit & highway access
Unlock the development potential
Western end of Center City
(i) Enhance subway-surface & subway lines
With new transit entrances + real time information
(ii) explore more expensive new service stops  For SEPTA or PATCO at 21 st  or 22 nd  Street
(iii) Enhance the public environment
Landscaping & new bike lanes
(iv) Transform Dilworth Plaza
New gateway to regional transit
New green amenities
New events programming
With programs that change with the seasons
 
$15 million TIGER grant $15.5 million RACP $5  SEPTA $5 million city $5-8 m: 3 foundations $3-5 million private  $20 milli...
Stimulate spill-over investments
In adjacent office plazas
Tomorrow: reopening a renovated Chestnut Park
(v.) To provide more amenities for growing number of families with children
About to start construction: Sister Cities, Logan Square
$4.6 million children park in front of Cathedral
We have a dense, compact, walkable  & transit-oriented downtown
It has been dramatically diversified  in the last two decades
It’s the first recession in which we outperformed our suburbs
We finally reversed the decline in residents
Now is the time to begin to add jobs
(1) Tax reduction/reform to retain & expand job opportunities for residents, students & immigrants (2) Plan for & make maj...
State of Center City will get even better
State of Center City will get even better
State of Center City will get even better
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State of Center City 2011

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From the press briefing for the Center City District's State of Center City report. State of Center City 2011 is downtown Philadelphia’s “annual report” that looks at all aspects of the downtown economy and makes recommendations to enhance the attractiveness and competitiveness of Center City. Download or order a copy at http://centercityphila.org/socc/

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State of Center City 2011

  1. 1. State of Center City, 2011
  2. 2. The story of the last 20 years is a tale of successful diversification
  3. 3. It is the story of a 9-5 business district
  4. 4. Whose public environment was in disarray in 1990
  5. 5. 1991: created a private-sector-led BID to turn this
  6. 6. Text Text Into this
  7. 7. Today: 69% of survey respondents Say Center City “much cleaner” than rest of the city
  8. 8. 1 And with a uniformed presence of CSRs
  9. 9. Working in partnership with police Substantial long-term trend: 1993-2010 <ul><li>45% drop in major crime in CCD </li></ul><ul><li>77.3% drop in theft-from-auto </li></ul><ul><li>“ Halo” effect outside CCD boundaries </li></ul>
  10. 10. 81% feel safe “most of the time” or “always” When in Center City
  11. 11. Clean & safe was the foundation on which we built a 24-hour downtown
  12. 12. 1992: investments in arts & entertainment
  13. 13. Today: 3 rd nationally non-profit arts & culture organizations per 100,000 downtown residents
  14. 14. New attractions continue to open National Museum of American Jewish History
  15. 15. President’s House
  16. 16. The Barnes Foundation: opening in early 2012
  17. 17. Several other major projects in the pipeline
  18. 18. PAFA’s new pedestrian plaza linking The expanded Convention Center to the Parkway
  19. 19. Original public investment Pennsylvania Convention Center 1993: We entered the hospitality industry
  20. 20. Prompted a 95% increase in hotel rooms
  21. 21. Generating significant private investment That adapted & reused vacant, historic buildings
  22. 22. Nearly all within 15 minute walk
  23. 23. Of a Center that has just doubled in size Successfully marketed by PCVB
  24. 24. 2001: New Independence Visitors Center
  25. 25. 2002: New home for Liberty Bell
  26. 26. #1 & #2 most visited destinations in the city
  27. 27. 94% increase in occupied hotel room-nights
  28. 28. 42% of expenditures of hotel guests Spent outside hotel on shopping & dining GPTMC
  29. 29. 328% growth in fine dining restaurants 278 65 in 1992
  30. 30. Even in last five years, through recession 31% increase in all types of food establishments
  31. 31. Total number of vacancies in all retail categories Steadily declined
  32. 32. Flourishing of sidewalk cafes
  33. 33. 1995 = zero
  34. 34. 2010: 213 outdoor cafes
  35. 35. Outdoor cafes: vote of confidence in quality of public spaces
  36. 36. Downtown that is clean & safe
  37. 37. Visitor- friendly: 683 pedestrian maps & signs
  38. 38. Integrated with 233 signs for motorist that the CCD also maintains
  39. 39. 741 trees; 96 planters
  40. 40. . 1 Doubled nighttime illumination 2,046 pedestrian-scale lights
  41. 41. Covering 2/3 of all streets in CCD
  42. 42. Supporting & fostering the evening economy
  43. 43. Speciality lighting to animate public spaces 3 JFK underpasses
  44. 44. Create more destinations within downtown
  45. 45. Even in recession 60% say atmosphere “ somewhat” to “much better” than last year
  46. 46. 1996: Residential success story Turning on the Lights Upstairs 4.5 million sf. Vacant Class “C” office space <ul><li>Retained architect & developer to evaluate buildings </li></ul><ul><li>Recommended 10 year tax-abatement </li></ul><ul><li>approved in 1997 </li></ul>
  47. 47. 1998–2010: 171 buildings of all sizes Converted to residential use
  48. 48. Since 1997 added 12,632 new units of housing
  49. 49. 27% increase in downtown population since 1990 93,074 residents; helped propel citywide growth Third largest residential downtown in the United States
  50. 50. Diversification of CBD land-use 22,000 residents now living inside CCD boundaries 22,000 71,000 surrounding
  51. 51. Steady outward growth of boundaries of downtown
  52. 52. 43% residents: Girard to Tasker work downtown
  53. 53. Education levels have increased dramatically
  54. 54. In the “knowledge economy” exactly the employees that firms want
  55. 55. Household income increased 106% since 1990 5.3% per year
  56. 56. More purchasing power for both housing & retail; $491 million within 30 minute walk of City Hall
  57. 57. Higher levels of education yield broader dividends A 10% increase in the share of a region’s residents with a college degree increases per-capita gross metropolitan product by 22%. More entrepreneurs, More business formation & more opportunities
  58. 58. Increase education level of Philadelphia residents 14.6% 9.7% 5.2% 2.3%
  59. 59. Downtown accounts for 39% of jobs; 43% wages
  60. 60. Because we have an integrated transit system 309,256 riders/day take transit into downtown
  61. 61. 20% of city residents living outside downtown; earn $3.5 billion annually working in Center City 12.7% = $1.5 b 10.1% = $1.2 b
  62. 62. 89% increase Latino population since 1990 Population 1990 2000 2009 Mexican 3,276 6,220 14,450 % tot. pop. 0.2% 0.4% 0.9% % change 89.9% 132.3% Puerto Rican 67,857 91,527 114,874 % tot. pop. 4.3% 5.9% 7.5% % change 34.9% 25.5% Cuban 2,553 2,730 2,827 % tot. pop. 0.2% 0.2% 0.2% % change 6.9% 3.6% Other 15,507 28,451 36,771 % tot. pop. 1.0% 1.8% 2.4% % change 83.5% 29.2% Total 89,193 128,928 168,922 % tot. pop. 5.6% 8.3% 11.0% % change 44.5% 31.0%
  63. 63. Three clusters of employment; Account for ½ of jobs in Mexican population Mexicans     Agriculture 4.91 Mining 8.99 Construction 22.62 Trucking services 0.07 Non-Durable goods manufacturing Groceries 1.02 Retail Grocery stores 1.18 Eating places 20.49 Insurance 1.52 Business and repair services Services to dwellings 3.18 Carwashes 3.08 Automobile repair 2.17 Professional services 10.98
  64. 64. How has Philadelphia fared in the recession?
  65. 65. Housing production dropped dramatically for condos & single family houses
  66. 66. Demand for rental remains strong
  67. 67. Average daily hotel room rates have declined
  68. 68. Expansion complete; 2,000 room shortage Room rates are rebounding
  69. 69. Office occupancy rates have declined
  70. 70. But in general, most CBD office districts have outperformed their suburbs. Philadelphia: #2 behind Houston is holding occupancy levels
  71. 72. Trends in health-care all positive: In-patient admissions downtown hospitals up 21% since 2001
  72. 73. Revenues at Center City hospitals are up +19%
  73. 74. NIH grant revenues are up  Thomas Jefferson University received over $75 million in grant money from the National Institutes of Health for the fiscal year 2009
  74. 75. Colleges & universities continue to grow 32,865 students downtown; 104,975 adjacent
  75. 76. Freshman applications risen 87.5% since 2002
  76. 77. 58% of seniors are “somewhat” to “very likely” to stay after graduation Campus Philly survey
  77. 78. 24% major in health services ; 21% major in visual & performing arts
  78. 79. Eds & meds employment is up 17% in last decade
  79. 80. This has been our primary buffer against recession
  80. 81. Density + accessibility are a second factor
  81. 82. 4 th most concentrated CBD for private sector jobs
  82. 83. 3 rd in total number private sector jobs downtown Accessible by transit as fuel costs rise
  83. 84. #1 nationally: walk to work 35% walk; 24% public transit = 59% commute without a car
  84. 85. 2 nd best in cumulative decline in house prices from peak Citywide
  85. 86. 270% increase in value since 1990
  86. 87. So while Philadelphia lost jobs in the recession
  87. 88. Outperformed the region; staying even with nation
  88. 89. Assessment trends 1991-2011: CCD assessments: diversification pays off
  89. 90. Balanced mix: office, health care, education, arts, entertainment, hospitality, restaurants, retail & residential Sectors reinforce each other & cross-fertilize
  90. 91. What are challenges & opportunties in front of us?
  91. 92. Office employment has steadily declined Even during periods of economic expansion
  92. 93. By contrast, it has grown modestly in the suburbs
  93. 94. Less occupied office space than 20 years ago
  94. 95. Rents have been static for decades & can not support new construction
  95. 96. Philadelphia’s concentration in eds & meds A buffer than conceals a potential weakness; Dependency on a sector that is vulnerable to changes in federal & state funding
  96. 97. Philadelphia’s share is double national average of 18% in education & health
  97. 98. Much higher than east coast peers over-concentration in one sector could put us at risk
  98. 99. Center City is more diversified, we need to keep it that way. Create spin-off industries, commercial application of research
  99. 100. We need to end this pattern of divergence
  100. 101. Worth recalling Mayor’s Force recommendations
  101. 102. <ul><li>The debate should not be limited to ………… </li></ul><ul><ul><li>Whether we restart wage & business tax reduction </li></ul></ul><ul><ul><li>in FY 13 versus FY 14 </li></ul></ul><ul><ul><li>nor focused only on: </li></ul></ul><ul><ul><li>Whether the Gross Receipts or the Net Income Portion </li></ul></ul><ul><ul><li>of the BPT is more important to cut </li></ul></ul>
  102. 103. <ul><li>Restructuring & realigning what we tax </li></ul><ul><li>Because we tax the wrong things </li></ul><ul><ul><li>Task Force did not simply propose reducing taxes, </li></ul></ul><ul><ul><li>It suggested that we: </li></ul></ul><ul><ul><li>Rely less on taxing what is mobile : jobs & firms </li></ul></ul><ul><ul><li>Rely more on what is immobile: land & improvements </li></ul></ul><ul><ul><li>Rely more on the property tax </li></ul></ul><ul><ul><li>We have a tax structure appropriate to a manufacturing city </li></ul></ul><ul><ul><li>When businesses could not easily move. </li></ul></ul>
  103. 104. 64% of local tax revenue comes from taxing highly mobile wages & profits PICA 55%
  104. 105. If you tax it (and it’s mobile), it will go
  105. 106. It was hard to move an assembly line Or a Baldwin Locomotive
  106. 107. Laptops and cell phones are far more portable
  107. 108. #1: We need a tax policy for a post-industrial city
  108. 109. Move quickly To capture the next cycle of growth in the city
  109. 110. #2: Invest in infrastructure; not just streetscape
  110. 111. We are very proud that $23.7 in CCD funds leveraged $22 million = $55.7 in public area improvements
  111. 112. (a) But we need bigger investments that enhance the competitive position of the region
  112. 113. 700 daily flights to 86 domestic cities 39 international destinations Extend reach of the International airport: Within 2 hours flying time of 50% of US population
  113. 114. By expanding runway capacity
  114. 115. Strengthen our position on AMTRAK NE Corridor
  115. 116. 68 minutes to NYC 95 minutes to Washington, D.C. Increasing speed & capacity of Acela trains 2 more cars/train = 40% increase 83 weekly trains to Washington D.C. 99 weekly trains to New York City
  116. 117. Preserve & capitalize on national commitment high speed rail 38 minutes to NYC; 67 minutes to Washington DC
  117. 118. HSR stopping both in Center City & PHL Airport Make downtown competitive with Jersey City & Hoboken
  118. 119. (b) Invest to reinforce major employment nodes
  119. 120. Downtown accounts for 39% of jobs; 43% wages
  120. 121. National Institute of Health (NIH) Research Funds: 2007 University City: 53% of NIH Research dollars
  121. 122. Vision: Front - 40 th : one continuous business district Regional center of transit-oriented development
  122. 124. Invest to connect city’s two largest employment & research nodes: 51% of jobs
  123. 125. Link Center City to University City
  124. 126. Fill the gap between the end of the office district..
  125. 127. … and Drexel’s plans to come east
  126. 128. Make it easier for Jerry to walk between his holdings
  127. 129. Enhance transit & highway access
  128. 130. Unlock the development potential
  129. 131. Western end of Center City
  130. 132. (i) Enhance subway-surface & subway lines
  131. 133. With new transit entrances + real time information
  132. 134. (ii) explore more expensive new service stops For SEPTA or PATCO at 21 st or 22 nd Street
  133. 135. (iii) Enhance the public environment
  134. 136. Landscaping & new bike lanes
  135. 137. (iv) Transform Dilworth Plaza
  136. 138. New gateway to regional transit
  137. 139. New green amenities
  138. 140. New events programming
  139. 141. With programs that change with the seasons
  140. 143. $15 million TIGER grant $15.5 million RACP $5 SEPTA $5 million city $5-8 m: 3 foundations $3-5 million private $20 million tax-exempt PNC loan Start of construction this fall
  141. 144. Stimulate spill-over investments
  142. 145. In adjacent office plazas
  143. 146. Tomorrow: reopening a renovated Chestnut Park
  144. 147. (v.) To provide more amenities for growing number of families with children
  145. 148. About to start construction: Sister Cities, Logan Square
  146. 149. $4.6 million children park in front of Cathedral
  147. 150. We have a dense, compact, walkable & transit-oriented downtown
  148. 151. It has been dramatically diversified in the last two decades
  149. 152. It’s the first recession in which we outperformed our suburbs
  150. 153. We finally reversed the decline in residents
  151. 154. Now is the time to begin to add jobs
  152. 155. (1) Tax reduction/reform to retain & expand job opportunities for residents, students & immigrants (2) Plan for & make major investments in infrastructure (3) Continue to improve the quality of public spaces
  153. 156. State of Center City will get even better
  154. 157. State of Center City will get even better
  155. 158. State of Center City will get even better

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