PHILADELPHIA | Highrise Development Thread IX

[summersm343]

Originally Posted by MikeNigh

Most of the people I know here who work up in the air and live in the city also prefer to live in high rises.

Exactly. Thank you for clarification. The good majority of new employees working in CITC will be tech savvy, educated, young, well paid, and have an urban sense of mind.

[theWatusi]

I'd suggest a friendly wager to see who is right over the next 5 years but I'd think it would be impossible to see what new construction is directly attributed to the new Comcast building.

[summersm343]

Originally Posted by theWatusi

I'd suggest a friendly wager to see who is right over the next 5 years but I'd think it would be impossible to see what new construction is directly attributed to the new Comcast building.

CITC will bring 3,000 new employees to Center City. It's going to bring about new residential construction as well. I'm not saying ONLY CITC employees can live in these towers... but to say it's not going to have an affect on the market is naivety.

[cubanChris]

Originally Posted by summersm343

You're thinking 2,000 people working in tech and media related fields will chose the suburbs over the city? You're wrong my friend. Come back to 2014, not 1984. I'm willing to bet at least 2,000 will chose the city. I would be shocked if even 1,000 people chose to live in the burbs. These are going to be young, well educated, likely single professionals. They will have good paychecks and disposal income, and will likely want a nightlife.

As for a rowhome? No, I doubt it. Most of these types of young professionals (like myself) could not give a rats ass about a yard, and want a condo tower or an apartment tower, with a maintenance crew and a management company.

Haha, i totally get what you're saying and I'm not attacking. Just think that it is very optimistic... more than I am, and I consider myself rather bullish on Philly.

I work in advertising which also trends extremely young/hip/whatever and even so, the balance of people living in the city VS suburbs doesnt skew 66/33. 50/50 at best, maybe 40/60. STILL, I think your point is valid that the single tower and development is enough to spur what may have been hesitant hands to work.

Honestly, the early 2014 announcement schedule puts evidence in your corner. Which I'm all but happy to concede having purchased here for the long haul myself.

[br323206]

Originally Posted by summersm343

Yes I have... and the people who choose those places (most of the time, not all of the time) either work in the burbs, or cannot afford to live in Center City. Those working at CITC, again, will have good paychecks.

This lines up with my experience. Those that live in Conshy do so because they work there or in KOP and don't want a super long commute.

Those in Manayunk are mostly college students and just graduated that cannot afford to live in CC or even University City.

East Falls? I don't know any young professionals that live there, but I do know a couple in their 40s--but I guess that depends on your definition of young.

[theWatusi]

Originally Posted by summersm343

CITC will bring 3,000 new employees to Center City. It's going to bring about new residential construction as well. I'm not saying ONLY CITC employees can live in these towers... but to say it's not going to have an affect on the market is naivety.

I'm not saying that there will be no effect on the residential real estate market, but it won't be significant enough to spur the development of several new towers.

[summersm343]

Originally Posted by theWatusi

I'm not saying that there will be no effect on the residential real estate market, but it won't be significant enough to spur the development of several new towers.

3,000 new employees won't be significant enough to spur the development of several new towers?

Really? Lol.

Even if only half, 1,500, choose to live in Center City, that's at least 5 towers. If only 1,000 choose Center City, that is 3 new towers.

Whether it is 1,000, 1,500, 2,000 or 3,000, that is A LOT of new residents coming into a market with a current 2% vacancy rate. There is not enough availability currently.

[Baconboy007]

All this back and forth has made the building gods angry!

http://www.nbcphiladelphia.com/news/local/Building-Collapse-3rd-Market-250200271.html

Can't we all just get along? Be happy new buildings are being proposed pretty much weekly.

[iheartphilly]

Originally Posted by summersm343

3,000 new employees won't be significant enough to spur the development of several new towers?

Really? Lol.

Even if only half, 1,500, choose to live in Center City, that's at least 5 towers. If only 1,000 choose Center City, that is 3 new towers.

Whether it is 1,000, 1,500, 2,000 or 3,000, that is A LOT of new residents coming into a market with a current 2% vacancy rate. There is not enough availability currently.

For sh*ts and giggles, I plugged in 1 or 2 bedrooms for rental prices of $1000-$2000 a month on zillow, and it produced 63 available units in the zip code of 19103. I'm using this as just a proxy and make no claims that this is definitive.

I think summersm has a point. Of course, the rental market is dynamic. Only time will tell if apartment/condo developers agree that there is a need for more mid to high rise apartment/condos. If they agree, they ought to be making their moves now for the influx of about 1000 new Comcast employees.

Feel free to play around and see what numbers you all get.

http://www.zillow.com/homes/19103_rb/#/h....115843,39.944358,-75.228968_rect/12_zm/

[MikeNigh]

Originally Posted by Baconboy007

All this back and forth has made the building gods angry!

http://www.nbcphiladelphia.com/news/local/Building-Collapse-3rd-Market-250200271.html

Can't we all just get along? Be happy new buildings are being proposed pretty much weekly.

Another botched demo... ? So long as no one got hurt, can't wait for the new construction they have planned for that corner.

[theWatusi]

Originally Posted by summersm343

3,000 new employees won't be significant enough to spur the development of several new towers?

Really.

You can take your idea for several new towers based on speculation where these new Comcast employees to the bank for a construction loan or pitch it to an established developer and I'll just sit here and laugh while you get rejected.

[PhiLaw]

Originally Posted by cubanChris

Haha, i totally get what you're saying and I'm not attacking. Just think that it is very optimistic... more than I am, and I consider myself rather bullish on Philly.

I work in advertising which also trends extremely young/hip/whatever and even so, the balance of people living in the city VS suburbs doesnt skew 66/33. 50/50 at best, maybe 40/60. STILL, I think your point is valid that the single tower and development is enough to spur what may have been hesitant hands to work.

Honestly, the early 2014 announcement schedule puts evidence in your corner. Which I'm all but happy to concede having purchased here for the long haul myself.

Your logic suffers from vertigo. Remember all of this has to take into account the status quo. There are app. 6 million people in the metro area, 1.5 million of whom live in the city proper. Thus, the city proper represents app. 25% of all residents. Thus, your purported 50/50 ratio still skews Philadelphia's way. I know we're talking about raw numbers here, but we need a sense of proportion.

[iheartphilly]

Originally Posted by PhiLaw

Your logic suffers from vertigo. Remember all of this has to take into account the status quo. There are app. 6 million people in the metro area, 1.5 million of whom live in the city proper. Thus, the city proper represents app. 25% of all residents. Thus, your purported 50/50 ratio still skews Philadelphia's way. I know we're talking about raw numbers here, but we need a sense of proportion.

This report in 2012 might interest you and address your query.

http://www.centercityphila.org/docs/CCR12_housing.pdf

[Jelly Roll]

Arguing over whether the Comcast employees will actually live in the new residential highrises that are going to be built is really missing the point. From a financial feasibility point of view the apartment market vacancy level is way below the healthy level for the market. I think most of us agree that there is plenty of demand currently for rentals in Center City and the supply is lagging behind. Prices are high enough that it is profitable to build new construction. So from a developers point of view if I had product to add right now it would be filled.

The next question that will be asked is what is the rental market going to look like three years from now. Even with all the new inventory coming online over that time period the vacancy rate is still going to be under 5% if the dynamics of the market does not change. Now add in the Comcast and FMC news along with the demographic trends of the area over the last 20 years and the estimates that are going into the future projections are positive. This means that anyone looking to start a project today with a completion date three years from now is going to have very positive assumptions in their forecasts.

So now we are to the point were the current market supports more units and the future market is going to be able to support new units and there have been recent buildings and sales comps that back up that new apartment construction is financially feasible in the market. So we have a situation that allows lenders to provide financing for these projects and the developers are making money on the projects allowing them to double down and build more.

In the end even if no Comcast employees actually live in any of these units the announcement allows everyone in the process to point to a specific item and say look Comcast is spending over a billion dollars on their new office building and bringing in thousands of new potential renters to a market that has almost no vacancy and that is why the forecasts are positive. Comcast is the thing that brings in the outside capital to build. Whether Comcast employees actually end up renting in the buildings in a mute point in my view because even without the news Center City needs more apartments. I think this is just the beginning of the cycle.

[McBane]

Originally Posted by theWatusi

Really.

You can take your idea for several new towers based on speculation where these new Comcast employees to the bank for a construction loan or pitch it to an established developer and I'll just sit here and laugh while you get rejected.

I have to agree. Plus, young professionals may not "give a rats ass" about a backyard, but I don't know any that can actually afford a condo or apartment in a high rise, let alone new construction. Most are opting to get more bang for their buck in periphery neighborhoods like Univ City, Fishtown, Manayunk, South Philly, etc.

We've seen all these great new proposals and almost all of them are geared towards the luxury market, not the average worker bee. This is especially true for high rise buildings, which need to be built for the wealthy in order to be profitable and to secure a bank loan.

Will the CITC have an impact on the housing market? Probably, but it will be a small effect spread over the entire metro area and help fuel smaller projects (think - a converted warehouse in Fishtown or a handful of townhomes in Grad Hospital). But it won't prompt a developer to go out and build a 300 footer.

That said, it certainly won't hurt the city's current momentum, either! Projects will hopefully continue to be proposed but don't count a developer attributing it to CITC. If anything, the CITC may spark more commercial buildings.

[Kidphilly]

What no new development announced today

All this chatter is boring - bring on some new renders

[Cro Burnham]

Originally Posted by summersm343

You make no sense... if this was a bunch of 7-9 story buildings, you would be complaining that they weren't tall enough, just like you did with 3737 Market, 3601 Market, etc.

You're against a 500+ footer now? And two 20 floor buildings?.

I smirked when I read those comments too.

Summer, some people just like to complain. Remember the outcry over the Evo design? Funny, most of us are pleased with it now.

Not to worry, though, complainers: it is highly likely that many of these proposals will never happen, and you can sit there satisfied knowing that we still have parking lots instead of these horrendous projects.

[summersm343]

Originally Posted by theWatusi

Really.

You can take your idea for several new towers based on speculation where these new Comcast employees to the bank for a construction loan or pitch it to an established developer and I'll just sit here and laugh while you get rejected.

Lol you're funny.

[summersm343]

Originally Posted by PhiLaw

Your logic suffers from vertigo. Remember all of this has to take into account the status quo. There are app. 6 million people in the metro area, 1.5 million of whom live in the city proper. Thus, the city proper represents app. 25% of all residents. Thus, your purported 50/50 ratio still skews Philadelphia's way. I know we're talking about raw numbers here, but we need a sense of proportion.

This makes no sense. All of these 6 million people in the metro don't work in center city. In order to get accurate numbers, we would have to find the workers working in center city only and where they live. Not the people working throughout the entire metro and where they live.

[summersm343]

Originally Posted by McBane

I have to agree. Plus, young professionals may not "give a rats ass" about a backyard, but I don't know any that can actually afford a condo or apartment in a high rise, let alone new construction. Most are opting to get more bang for their buck in periphery neighborhoods like Univ City, Fishtown, Manayunk, South Philly, etc.

We've seen all these great new proposals and almost all of them are geared towards the luxury market, not the average worker bee. This is especially true for high rise buildings, which need to be built for the wealthy in order to be profitable and to secure a bank loan.

Will the CITC have an impact on the housing market? Probably, but it will be a small effect spread over the entire metro area and help fuel smaller projects (think - a converted warehouse in Fishtown or a handful of townhomes in Grad Hospital). But it won't prompt a developer to go out and build a 300 footer.

That said, it certainly won't hurt the city's current momentum, either! Projects will hopefully continue to be proposed but don't count a developer attributing it to CITC. If anything, the CITC may spark more commercial buildings.

The argument here is apartment towers. Not condo towers. While some apartments are definitely prices for the wealthy, new apartment towers are easily affordable by someone making $70k a year.