Category: Commercial Real Estate

A building boom is unfolding on Front Street in Fishtown along the Market-Frankford elevated train line.

Walking north beneath this towering transit edifice, pedestrians are forced to zig-zag across the street to avoid construction sites spilling onto the sidewalks. The total number of apartments on Front Street between Girard and the York-Dauphin stations is set to almost double in the next year.

“It’s pretty surreal to see it all happening at the same time,” said Henry Siebert, cofounder of Archive Development, which plans to build at 1440 N. Front St. “The amount of construction that’s ongoing, I don’t see that anywhere else in Fishtown.”

According to the CoStar Group, a commercial real estate analytics firm, there are 441 apartment units actively under construction along this 1.1-mile stretch of the Market-Frankford Line, another 174 are proposed, and 231 have been completed since 2019. (There were 215 apartment units along the stretch prior to that year.) And that’s probably a slight undercount because it only includes projects with five units or more.

There are new apartments popping up in the storefronts of renovated older buildings along the train line, such as the building that housed Mighty Mick’s boxing gym in the Rocky movies. When construction there is complete, it will include a commercial space of 2,600 square feet along with four apartments in the revitalized historic brick building.

All this is happening as SEPTA ridership is dramatically lower than it was before the pandemic. In November, ridership on the Market-Frankford Line was only at 58% of February 2020 levels. Ridership at the stops in this part of Fishtown is even lower, according to data provided by SEPTA, with the York-Dauphin station only seeing 46% of 2019 ridership levels in 2023, the Berks station 52%, and the Girard station 48%.

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With the rise of remote work, far fewer office workers are going into Center City for a full five-day workweek. That means that some of the upper-middle-class tenants flocking to newly built apartment buildings are riding transit less than ever.

With fewer users, antisocial behavior on mass transit has become more common since the pandemic, especially on the Market-Frankford Line that runs above Kensington, which has long been the center of the city’s opioid epidemic.

And yet, the transit infrastructure is attracting a level of investment unprecedented in modern memory.

“SEPTA is experiencing a rough patch,” said Yonah Freemark, a senior researcher at the Washington-based Urban Institute, a policy think tank. “But for all the problems with drug abuse and lack of investment from the public sector, the fact that private investors want to spend huge amounts of money bringing hundreds of apartments to the neighborhood seems incredibly bullish for the future.”

A ‘critical mass’ of demand

Few neighborhoods in Philadelphia have been as transformed as Fishtown since the Great Recession.

In 2012, political scientist Charles Murray used the neighborhood as the embodiment of all that had gone wrong for a downwardly mobile, white, working-class America. The commercial corridors on Frankford Avenue and Front Street were run-down, with many shuttered storefronts. The headquarters of the Warlocks Motorcycle Club could be found, but not a wine bar.

Now, Fishtown is the neighborhood in Philadelphia outsiders are most likely to be able to name, partly due to a spate of national media attention. The Warlocks vacated in 2011, and Frankford Avenue is now a thriving commercial corridor home to many of the city’s finest restaurants (including a James Beard Award winner), cocktail bars, and a La Colombe that looks large enough to house a harrier jet. According to Census data, the Northern Liberties and Fishtown area now has the highest median income in the city.

“As Northern Liberties got all the hype [in the 2000s] prices went up and people started moving into Fishtown because it was more affordable,” said Brenda Nguyen, associate director at CoStar’s Philadelphia office. Now “the Fishtown area has enough dense housing, retail, restaurants, and neighborhood amenities that there’s a critical mass of demand.”

Throughout Fishtown’s redevelopment, many of the large vacant lots on Frankford Avenue, and elsewhere east of the Market-Frankford Line, filled in. Within a 10-minute walk of the heavy rail line there are 4,585 existing apartment rentals and 1,646 under construction. (A further 922 are proposed, although their status is unclear given the development industry’s current deep freeze.)

“When we originally started developing in the city in 2018, I told [my partner] that we would likely never develop a property along the El,” said Siebert. But “as large-scale development opportunities became more and more scarce, developers eventually turned their attention to Front [Street].”

Many developers had avoided the thoroughfare, partly because the looming edifice creates challenges with noise from passing trains and limits natural light. But the area became more appealing as other developable land vanished.

It helps that the land along this stretch of the Market-Frankford Line is zoned to allow taller and denser buildings than much of the rest of Fishtown. Archive Development addressed the challenges of building next to the train line by designing a first floor with 17-foot ceilings, ensuring the residential units on the second floor were elevated above transit. They plan to install windows with special glazing to reduce noise from passing trains.

Developers who have seen how Frankford Avenue has thrived to the east hope that they can build enough housing to create the demand for a second strong retail corridor. But they also hope to help establish attractive retail businesses that will, in turn attract more tenants. It’s the virtuous cycle that helped early developers in Fishtown such as Roland Kassis — who is also building next to the El — successfully launch businesses such as Frankford Hall and the La Colombe flagship.

“I was talking to a broker the other day and he said that what people want is an activated street front,” said Rafi Licht, a developer with Norris Square Development, the company behind the renovated Mighty Mick’s gym building.

“That’s what we’re aiming for here,” said Licht. “Putting in coffee shops, bars, restaurants, whatever is going to activate the street that makes it easier for people to imagine living upstairs.”

Norris Square Development is also working on other properties around the York-Dauphin stop. In 2022, Rowhome Coffee opened in its building at 2152 N. Front St. It drew a crowd then, and it still does.

“When Rowhome Coffee opened during the pandemic, people were queued up for the takeout window,” said Jonathan Auerbach, a partner in Norris Square Development. “I saw young women with prams lined up and realized, wow, people have been waiting for this.”

Will the redevelopment of Front Street aid mass transit?

Few of the developments along the El are subsidized, meaning rents will be relatively high in comparison with housing costs in nearby working-class and lower-income neighborhoods. (The rents in the Mighty Mick’s building will be close to $2,000 for a two-bedroom or $1,600 for a one-bedroom.) Many workers who have jobs that require in-person attendance — such as retail, hospitality, or restaurant work — are less likely to be able to afford newly constructed, transit-oriented apartments.

Even before the pandemic, most studies showed that lower-income and working-class people are far more likely to use transit, partly due to the high cost of car ownership and partly because they were more likely to live in cities with extensive transit systems.

A 2016 Pew study and a Census study of 2019 commuter behavior also revealed that higher-income Americans were more likely to use transit than their middle-income peers, perhaps because wealthier people had started moving back to the transit-rich big cities of the Northeast.

But post-pandemic, transit may be less of an important amenity than it once was.

“[These] renters might not see public transit as a primary factor when they’re choosing where they want to live,” said Nguyen of CoStar. “It’s more of an added bonus.”

Still, developers in Fishtown argue that even if white-collar workers are less likely to be going into the office five days a week, the Market-Frankford Line still offers unparalleled access to Center City and University City.

“If you’re going to the office [at all], you still need a way to get to Center City,” said Ryan Kalili, cofounder of Archive Development. “Two days or three days a week is still enough that you’re not going to Uber. “I think [ridership] hopefully will change as the northern part of Front Street [attracts more residents].”