For more than a century, the imposing brick building at the corner of 31st and Jefferson Streets housed a brewery, then a warehouse, small businesses and, briefly, another brewery. More recently, it has remained a vacant and graffiti relic for 16 years. This spring it will take on new life as apartments and commercial spaces.

The former home of FA Poth Brewing Co. is part of the fabric of Brewerytown, “and it would be a sin for this building to be demolished,” said David Waxman, co-founder and managing partner of Philadelphia-based MMPartners, which develops the site. .

Construction is underway to outfit the new Poth Brewery with 132 apartments and 25,000 square feet of retail space. Because the structure was not built for apartments, many units are unique in shape and size with 36 different layouts. The openings in the masonry will become windows, the exposed steel beams will be the focal points in the new skylights and the existing graffiti will be sealed on the walls of the apartments.

“Everyone assumed this building was shot down,” said Aaron Smith, co-founder and partner. “The fact that this building could live another 50, 60 years – nothing could make us happier.”

Philadelphia developers have created more than 1,800 apartments in 10 old buildings that have been or are nearing redevelopment in the past two years, more units than in any other American city, according to an analysis released last month by RentCafe, a national apartment. research site. Philadelphia has been a leader in adaptive reuse since the 1980s. The city is dotted with converted factories, warehouses, offices, churches, and schools.

Philadelphia’s rank comes as no surprise, said developer Carl Dranoff, who helped spark the city’s adaptive reuse boom as co-founder of Historic Landmarks for Living, the world’s largest rehabilitator of historic buildings. country when he converted buildings such as Chocolate Works and Bridgeview Place in Old Town in the 1980s.

“We are the oldest big city and we have the most historic buildings just in size and longevity,” said Dranoff.

In other words, said Paul Steinke, executive director of the Preservation Alliance for Greater Philadelphia, “we better be at the top of this list.”

Considering Philadelphia’s past as a manufacturing hub and the diminishing need over the past decades for the towering buildings that have proliferated for this purpose, the city has a large inventory of factories awaiting completion. reuse.

These are “unused and dilapidated buildings that are often major challenges,” said Paul Levy, president of the Center City District, which manages and takes care of the downtown area.

From the 1950s to the 2010s, Philadelphia added about 11,200 apartments in converted buildings, according to RentCafe.

“Philadelphia has long lacked any kind of real municipal incentive for historic preservation and adaptive reuse,” Steinke said. “But we’re about to get one back.”

On January 1, the city’s property tax abatement for new residential construction is reduced from 10 years to five years. But tax relief for rehabilitated properties will continue in full, creating the city’s first real financial incentive for adaptive reuse since the tax relief was extended from rehabilitation only in the late 1990s to all buildings. in 2000, said Steinke.

“We think it could be a big deal,” he said.

READ MORE: How Philadelphia Finally Changed the Loved and Hated 10-Year Tax Abatement

Thanks to city council legislation enacted in 2019, developers who redevelop historically designated buildings are freed from parking requirements, and some historic conversions qualify for more flexible zoning.

“To some extent, Philadelphia has failed to act like the historic city that it is in terms of redevelopment and rehabilitation goals,” Steinke said. But he sees the city taking a turn with the new city laws.

Federal historic tax credits encourage developers to take care of historically designated buildings by protecting them from some of the risks associated with old structures that can contain costly structural and environmental surprises.

READ MORE: Historic preservation gets a little easier in Philly as mayor signs incentives into law

“I think we have neighborhoods here where the buildings would have been razed without the historic tax credits,” Dranoff said.

Over the past two years, the cost of construction has increased as supply chains have been disrupted and material prices have risen. Renovating a building that is suitable for conversion can take less money and time than new construction because the building infrastructure already exists and contractors use fewer materials.

READ MORE: Six Philadelphia Real Estate Projects Got Historic Tax Credits From State Agency (As of 2019)

Converted buildings may have less of an impact on the environment than new construction. The history and character of older buildings make them attractive to many developers and potential tenants. Because vacant and dilapidated buildings lower the value of a community’s property and invite crime, the rehabilitation of abandoned buildings can trigger a rejuvenation of the neighborhood and the economy.

Old City’s reimagining of its industrial history into a more residential neighborhood has sparked a full-time dynamism that has been displayed over the past two years, said Job Itzkowitz, executive director of the Old Town district.

“Having this residential density has been extremely important to the Old Town throughout the pandemic,” he said. “Thank God this conversion has already taken place. “

With the future of offices uncertain as more and more employees work remotely, the pandemic could prompt more conversions of offices to residential uses. According to RentCafe’s analysis, 41% of the apartments converted across the country in the past two years are in old office buildings.

Residential adaptive reuse projects across the city vary in size and scope.

Civetta Property Group has transformed a historic building that once housed a theater school and theater in the old town into its first floor office with apartments at the top. The developer’s portfolio of single and multi-family homes is a mix of new construction and rehabilitation.

While searching for smaller multi-unit opportunities, the company converted a textile mill at 1737 N. Howard St. in North Philadelphia into a seven-unit apartment building in 2016, the company said. co-founder Brennan Tomasetti.

“If we can restore and preserve something that is in relatively good condition and that can be saved, we like to do it and we prefer to do it,” she said.

MMPartners adapted the former St. Joseph Hospital on 16th Street and Girard Avenue in North Philadelphia into Civic – nearly 90 apartments and commercial space – in 2019.

READ MORE: Two buildings demonstrate Philadelphia’s ability to change – and to change again | Inga Safran

Developer Tony Rufo brought 151 apartments to a long-vacant South Philadelphia brush factory at 12th and Jackson Streets that opened as Brush Factory Lofts in 2019.

Post Bros. converted a century-old Strawbridge & Clothier warehouse in North Philadelphia into Poplar Apartments, which opened to residents this year.

Frank DiCicco, chairman of the city’s Zoning Board of Adjustment, said the number of recent building conversions is “pretty incredible.”

“It looks like they’re filling up,” DiCicco said. “They’re not just built and sitting there. There is a demand.

Residential buildings with shops on the ground floor remain popular projects that help revitalize communities, said Marc Collazzo, executive director of the Fishtown Kensington Area Business Improvement District.

“What has happened is that instead of having these old run down properties, people are really coming in to fill a need and fill a desire,” he said. Especially with the old, tall, solid brick buildings, he said, “they’re aesthetically pleasing and they’re healthy, so let’s do something good with them.”

The Business Improvement District is trying to acquire a vacant fire-damaged building on East Girard Avenue that was once owned by a non-profit organization. The organization plans to set up a business on the ground floor and affordable housing above. A court hearing is scheduled for November 15.

Although the city is a leader in adaptive reuse, “Philadelphia continues to lose a lot of buildings that could easily be saved,” Waxman said.

“For a lot of developers, they only see risks and don’t want to take them,” he said.

Assessing the strength of a building’s foundation and supports, remedying asbestos and other environmental hazards, and adapting a building for residents can be costly. Sometimes the windows are too small, the ceilings too low, and the beams are poorly placed. Not all old buildings are good candidates for residential reuse.

The redevelopment of properties for a new use sometimes comes up against opposition from neighbors and legal battles. Plans to turn St. Laurentius Church in Fishtown into apartments, for example, failed, and the church would have to be demolished to make way for new construction.

READ MORE: L&I grants demolition permit for St. Laurentius Church in Fishtown

MMPartners acquired the Poth Brewery building in January 2018, but had to face a lengthy process to obtain a zoning permit due to a list of construction violations accumulated by a previous owner, Waxman said.

Despite the challenges, over the past two decades the city has come together and attracted “a very robust industry” of developers and architects with expertise in building conversions, said Levy of the Downtown District. .

“Hopefully this will continue until we take the whole bane away from Philadelphia,” said Ken Weinstein, president of Philly Office Retail, a northwest Philadelphia-based development company focused on adaptive reuse and preservation of historic buildings. “It takes hundreds of developers to do it, so everyone has to get started. “

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