Housing Authority Redevelopment Lifts Property Values 142%

PHILADELPHIA-Two separate studies by independent agencies revealed there has been a significant increase--up to 142%--in property values at six Pennsylvania Housing Authority redevelopment sites between 1999 and 2004. Just two of the sites have been completed, yet Stephen Mullin, author of the study by locally based Econsult Corp., says, "these areas appreciated in value from the time PHA announced plans for demolition through completion of construction."

The Econsult analysis estimates that property values in and around the six sites rose by an aggregate of more than $200 million over the five-year period and generated an additional $4 million a year in property taxes. The study by Chicago-based Applied Real Estate Analysis Inc., covering the same six sites and their surrounding areas during the same timeframe, reports that overall property values rose 142%. That is more than 2.5 times the citywide rate of 55% during the same period, according to AREA analysts.

The projects are Richard Allen Homes and Cambridge Homes in North Philadelphia, Courtyard at Riverview in Queen Village, Martin Luther King Homes south of Center City, Falls Ridge in East Falls and Greater Grays Ferry Estates in South Philadelphia. The Allen and Riverview developments, with 408 and 470 rental units, respectively, are fully built and occupied. Cambridge, with 124 rental units, will reach completion this summer.

The three additional redevelopments, each of which contains for-sale and rental housing, are scheduled for completion next year. They will provide an aggregate of 354 owned homes and 730 rental units.

All of the redevelopments are mixed-income, suburban-style communities, a strategy initiated by Carl Greene, PHA executive director, to change the "not in my backyard" reaction to one that welcomes PHA housing. "What we see from these studies," Greene says, "is that our program is reviving neighborhoods…, but what the studies can't show is the tremendous change in pride and attitude that these transformations inspire."

Greene took the PHA post in 1998 promising an "entrepreneurial mode." To fund the redevelopment, investors bought tax credits, leveraged with public subsidies. PHA commissioned the studies to demonstrate how investments of both public and private funds "more than pay for themselves," Greene says.