Not all vacant properties are alike.
Some vacant buildings and lots are located in strong neighborhood real estate markets such as Northern Liberties, where the chances of attracting capable, profit-motivated developers are reasonably good. Other vacant properties are located in “changing” neighborhoods, such as Point Breeze, where opportunities for development are much more limited but may increase during the coming years. And others are located in weak real estate markets such as Tioga/Nicetown, where the cost of rehabilitating a vacant building or constructing a townhouse on a vacant lot substantially exceeds the market value of the finished product. We need to decide which properties to return to the real estate market with few or no restrictions (other than compliance with codes), which ones to offer with conditions attached in order to support equitable development in changing neighborhoods, and which ones to hold off the market until conditions improve.
Not all investors and developers are alike either.
The best ones seek neighborhood approval for their development proposals, comply with city standards, and produce high-quality products that enhance their surroundings. But other investors and developers acquire and hang on to deteriorated properties, skirt city code requirements, and contribute to neighborhood blight. We need to do more to encourage responsible developers while defending our communities against predatory speculators.
Enabling legislation currently under consideration in Harrisburg (where HB 1682
has been approved by the House and is expected to pass the Senate and be signed by the Governor) will help Philadelphia and other municipalities organize an effective asset management strategy for vacant property. To begin with, the legislation would make it easier to achieve a key Nutter Administration goal: establishing a clearinghouse—a “land bank authority”--that would market and efficiently convey publicly-owned properties to designated recipients. The enabling legislation would also make it easier for a land bank authority to acquire tax delinquent properties that would otherwise be auctioned at Sheriff Sale, with little or no consideration of winning bidders’ credentials or plans.
Senior members of the Nutter Administration have participated in many discussions about the drafting of the state land bank legislation and related implementation issues. Councilwoman María Quiñones-Sánchez has proposed a city ordinance (Bill No. 12005200
) to create a land bank authority in Philadelphia.
Questions and concerns are being raised as well, and they’ll need to be addressed. Here are some of the biggest ones, along with suggestions about how to resolve them.
Why do we need another public agency?
We don’t—the land bank authority could be an existing agency such as the Philadelphia Redevelopment Authority (PRA), which already employs professional staff with expertise in real estate and development financing transactions.
What’s to stop the land bank authority from giving preference to politically-connected developers?
A land bank authority—like a Redevelopment Authority, a Zoning Board, or a City Planning Commission—is only as good as its leadership. When the board and managers of an authority or department report to the Mayor, when the Mayor enforces a strong code of ethics, and when information about the transacting of city business is made publicly available, the likelihood of favoritism and corruption is substantially reduced. Under the Nutter Administration, some Redevelopment Authority actions have generated controversy over city policies; but the city has no counterpart to the scandalous insider dealings associated the Commonwealth’s mishandling of the Family Court building project. It’s up to us to make sure that future city administrations maintain the high standards currently in place.