The Philadelphia Naval Shipyard, now better known as The Navy Yard, was the first naval shipyard in the United States and more recently has become one of the biggest adaptive re-use projects in the country. After the U.S. Navy reduced its activities in the early 1990s and ended most by 1995, a large portion of the yard was left abandoned and created a large eyesore along Philly’s southern edge. But due to the site’s size, city planners saw an opportunity and soon got to work creating a new master plan for the area with the goal of transforming the yard back into something economically viable.
Over the past few years, with the help of large tax incentives, the early pieces of the master plan have taken shape. Large companies like Urban Outfitters have moved their headquarters to the campus, transforming previously unused buildings into economically viable parcels. What great stories the Navy Yard can now tell: a new waterfront community is developing, creative adaptive reuse has taken hold, and sustainable, green building and neighborhood techniques have become the norm. While these are no doubt positive narratives for Philadelphia to tout, it isn’t hard to argue that the overall effect of this success has actually been a negative for the local economy of Philadelphia and specifically Center City.
Simply put, the emergence of the Navy Yard as a premiere place to do business has been at the expense of Center City, the region’s largest employment center and cultural heart. Soon after the city began subsidizing the Yard’s development, large companies like Urban Outfitters, Inc. and more recently GlaxoSmithKline have moved out of Center City, either rehabilitating unused structures or building new space within the Navy Yard. This is bad urban planning – due to the site’s poor transit connections and overall isolation, what has already been built and what the master plan is calling for is seas of parking lots, single-use structures and single-use land use zones akin to suburban developments of the 1960s-1990s. It really isn’t surprising the Navy Yard has taken on these characteristics, given its poor access to the rest of the city, but what doesn’t make sense is the city incentivizing such development. Here are the two main reasons why:
First, it’s a loser for the city economically. It’s a given that high-rise, high-density development, office or otherwise, is far more efficient at making money for municipalities than low-density development of the type seen in the Navy Yard. Consider an example in Asheville, N.C., where a Super Walmart about two-and-a-half miles east of downtown brings in an impressive $20 million in tax value. But it sits on 34 acres of land, thus yielding $6,500 an acre in property taxes. Meanwhile, a remodeled JCPenney in downtown Asheville is bringing in $634,000 per acre due to its dense nature. This concept is true everywhere. In Raleigh, it would take 600 single-family homes on a 150-acre subdivision to equal the tax base of the 30-story Wells Fargo Capitol Center in its downtown. And the Wells Fargo Center sits on 1.2 acres of land. The concept can be copied and pasted in every American city and certainly in Philly. This is why the city should not be incentivizing low-density development in the Navy Yard at the expense of Center City’s dense, high-yield nature – acre by acre, it’s a tax base loser.
Second, it’s a loser for the City economically. According to AAA, Americans spend, on average, about $8,500 a year on their cars. Of that $8,500, about 85 percent, or close to $7,000, leaves the local economy, with only $1,500 remaining in the area. If the city could invest in public transportation improvements and encourage, say, 15,000 people to get rid of their cars, the local economy would gain over $127,000,000 it otherwise would have lost. Instead, Philadelphia is investing in the expansion of the car-dependent, suburban-style Navy Yard, to the negative consequence of the local economy, since most Yard workers are forced to own a car and drive to work. Considering the Navy Yard has about 8,000 workers, and assuming 7,000 drive to work, that’s a loss of nearly $60 million to the local economy that could be recouped if these companies were in transit-rich, high-yield places like Center City.
Now it is fair to note that the idea behind the Navy Yard isn’t all bad, but the planning and development of it has been. Sure, it would be great if the Navy Yard developed into another sustainable mixed-use neighborhood of Philadelphia. But based on its current development pattern, its exceptionally suburban nature (you need a key to get onto its premises), and what the master plan is calling for in the future, don’t count on it. It’s time the city stops incentivizing businesses to move there and starts luring them back to Center City where they belong. Economically, and well, economically, it’s the best bet.
-By Greg Meckstroth for PhiladelphiaRealEstate.com
Navy Yard photo by the author
Thanks for your article, it identified problems that I would not have considered.
I always thought the Navy Yard would have been more entertainment-focused for the stadiums. But, what do you see as the best use of this property?
Should the Navy Yard site still encourage development for entertainment?
Would you see non-profit organizations’ administrative buildings as an appropriate use?
Is there a public transportation plan to provide Philadelphia residents easy access to the Navy Yard site?
I figured Greg might have a response for you, Barry, but since it looks like he didn’t have the time, and since I’m up on this subject too, I’ll step in.
Part of the problem with the Navy Yard as it has been developed is that high-capacity public transportation – a Broad Street Line extension, to be specific – has been a “future” rather than an integral part of the redevelopment plan. Because the subway extension is an afterthought, the reuse of the Navy Yard has largely taken place along suburban office-park lines. A Navy Yard subway extension is very much on local transportation planners’ wish list, but no one’s pushing hard for it, and if no one’s pushing hard for it, the money to build it likely won’t come. Worse still, the one transit line serving the complex – the Route 71 shuttle bus from AT&T Station – is about to be axed, and I don’t think that there are plans to extend Route 4 to fill in the gap.
Given the abundance of industrial, warehouse and other commercial buildings available for reuse at the Navy Yard site, it doesn’t surprise me at all that redevelopment as an entertainment district wasn’t really seriously considered. It’s just far enough away from the stadium complex that walking is inconvenient, and the pedestrian-hostile infrastructure in the area doesn’t help things any either. Entertainment districts IMO should be located near where people actually live anyway, despite the problems they cause; to mitigate those, spread the activities out rather than concentrate them.
I also think that residential development – part of the original Navy Yard master reuse plan, by the way – should be accelerated as part of the ongoing redevelopment. It probably should not be where the Navy’s small housing developments were, on the opposite side of the former Mustin Army Airfield, but closer to the historic core. However, I don’t think the city’s development plan agrees with me. But housing should be built, and soon, for it will increase the likelihood that the sorts of everyday services currently lacking completely, forcing workers to drive off-site for most of their midday needs, will arise on-site.
There are a number of historic buildings at the yard’s core that could make good office space for nonprofits and small companies. I think the master plan has most of them being converted to that role anyway.
But – as Greg points out – as long as the Navy Yard is in essence providing an in-city “suburban” location for companies already here rather than attracting new startups and relocations from elsewhere, it probably doesn’t matter what use the rest of it’s being put to.