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The West Philly Housing Crisis That Was Utterly Avoidable

The UC Townhomes fiasco features a wealthy, easy-to-blame institution; fact-challenged protestors; an elected official who may be in over her head, and a compromise solution everybody seems hell bent on ignoring

The West Philly Housing Crisis That Was Utterly Avoidable

The UC Townhomes fiasco features a wealthy, easy-to-blame institution; fact-challenged protestors; an elected official who may be in over her head, and a compromise solution everybody seems hell bent on ignoring

At the risk of being presumptuous, permit me to begin by speaking for the citizens of Philadelphia: We’re sorry, Penn President Liz Magill. In case you missed it, a couple of weeks ago, the new head of the University of Pennsylvania readied to give her first major address at the school’s annual Convocation, welcoming new students. Minutes into her speech — ironically titled “The Importance of Productive Disagreement” — protestors began shouting her down.

“Save UC Townhomes!” some chanted, while others chimed in with “Stop Penn-trification!” While actual undergraduate students in attendance tried to encourage Magill to finish her remarks, it was a no-go. She instead filmed a video of the speech and sent a transcript of her remarks to all of her school’s new students.

There’s an obvious storyline here, of course: College campuses, pushed by students, were once a bastion of free-flowing thought, with ideas and counter-ideas clashing in the air. Now, as evidenced most ominously in The Coddling of the American Mind by Greg Lukianoff and Jonathan Haidt, campuses, often pushed by students, have become places where open-minded debate goes to die.

What Magill ran into, so early in her term of office, was not a good look, Philly. Not only was it uncivil, it was counter to the ideals of both the university and civil society, because under no circumstances can the blocking of others from speaking be somehow seen as the exercise of free speech.

University of Pennsylvania President Liz Magill.

But there’s another, less obvious story told by the heckling of the Penn president. Call it the rise of know-nothing activism. We’re seeing a trend: Well-meaning ideologues making a lot of noise but not fully grasping the actual issues at play. Case in point last weekend, when the inspiring North Carolina-based Rev. William Barber came to West Philly to take up the UC Townhomes cause.

“Philadelphia will not get right if you treat UC Townhomes wrong,” he bellowed, skewering Mayor Kenney, Penn and Drexel for “undermining the heart of the city.” He was full of eloquent and morally indignant one-liners, but — like the Convocation protestors — notably short on facts.

So let’s dive in. Why all this sturm and drang?

The catalyst has been the impending displacement of some 70 families at the aforementioned University City Townhomes, an affordable housing complex at 3900 Market Street, which are not actually on Penn’s campus and over which Penn has no stake, financial or otherwise. Last year, landlord IBID Associates declined to renew its affordable housing contract with the U.S. Department of Housing and Urban Development, as was its right, and sought to sell the valuable 70-unit site.

IBID isn’t some fly-by-night landlord. It had a 40-year arrangement with HUD whereby the feds pay the difference between the charged rent and 30 percent of a household’s income, a system designed to ensure affordable housing, with an incentive for landlords to cash out down the road. After 40 years of managing the site, IBID was finally looking to redevelop the site and sell to a developer who would build a life sciences lab — likely for somewhere in the neighborhood of $100 million. Well, get ready, folks — this is just the canary in the affordable housing coal mine. Thousands of city units will also soon be coming on the market, as other HUD contracts expire.

Seventy tenants forced out of their homes? Let the protests begin, right? Well, not so fast. When you dig into the story, it’s not as simple as the protestors, or most media coverage, would lead you to believe. The UC Townhomes fiasco has all the elements of big city melodrama: A wealthy, easy-to-blame institution in close proximity; knee-jerk oriented, fact-challenged protestors; an elected official who may be in over her head, and a compromise solution everyone seems hellbent on ignoring.

Perhaps most important is what it’s missing: A rapacious landlord, which we’ll get to.

“I am consistently one of Council’s biggest champions of affordable housing, and throughout my tenure I have been unafraid to challenge the status quo,” Gauthier wrote.

Turns out, the UC Townhomes story is complicated. The usual progressive talking points just don’t fully apply. Here’s some context those protestors on Penn’s campus and Rev. Barber would be well advised to take into account.

The Compromise Solution That Wasn’t.

The way these blow ups usually go, there’s an easy villain to target. In this case, the landlord in question appears to have made significant efforts to preserve affordable housing on the site. IBID and its buyer, National Real Estate, entered into negotiations with the residents and Councilperson Jamie Gauthier — because, in Philly, thanks to the scourge of councilmanic prerogative, nothing gets done when it comes to land development without a district councilmember calling the shots. Those negotiations broke down and the case is now in litigation, so IBID declined to talk to me, and Gauthier sent me a few responses to e-mailed questions. But I have spoken to a number of players close to both sides who have had either first- or second-hand knowledge of the talks.

The consensus is that the offer made by IBID and National — of which some details were made public before the litigation — was a generous one. Yes, the prime development would involve turning the property into a life sciences lab, but the IBID/National plan included providing some 70 affordable residential units, with first priority going to those residents who had been in the Townhomes. In addition, the new landlord would pay the tenants’ moving expenses and IBID would transfer its existing Section 8 certificates to other affordable housing sites in West Philly, thereby potentially providing for another 100 units of affordable housing in the neighborhood.

Moreover, National offered to fund and develop a Life Sciences Job Training Center on the site, so residents could be primed for the myriad jobs being provided right where they live. If you care about maintaining affordable housing and establishing a pipeline of jobs that can lead to middle class stability, that doesn’t sound too bad, does it?

Councilperson Jamie Gauthier

But that offer appears to have fallen on deaf ears. Community members, students, activists and tenants began organizing upon the year-long notice provided by IBID that it would be selling. As negotiations proceeded, the rhetoric in opposition heightened, seeming without regard to the package IBID and National had put on the table. A letter to IBID from Richard Kirk, Board president of Calvary Center for Culture and Community on 48th Street was typical.

“The destruction of a functioning community and the displacement of low income families, essentially destroying their support system and community, is a barbaric act,” he wrote. “In West Philadelphia and University City, Black lives really do matter very much. No amount of profit can erase the stain of displacing people who have nowhere to go.”

IBID’s response tries to set the record straight, explaining that the landlord met with Councilmember Gauthier beginning in 2019 when the decision was made to eventually sell, for the express purpose of trying to maintain affordable housing:

More than a year ago, as recently reported in The Philadelphia Inquirer, we began negotiations with a potential buyer that shared our concerns about affordable housing, and in the end this developer created a plan that we believed would be a win for all parties. The plan called for the development of both a life sciences research campus and approximately 70 new units of affordable housing, along with a community job training center to train local residents for jobs in the life sciences center, and a block of retail shops, all of which would be built on site. In other words, in addition to the research campus, the redevelopment plan would have replaced the existing townhomes with as many as 70 units of new affordable housing on the site – or as you describe it, a plan to ‘rebuild this complete community’…

Unfortunately, this offer was never accepted, and instead the Councilmember led the passage of legislation that makes it untenable for any developer to move forward.

Which gets us to: Councilmember Gauthier, what were you thinking?

Clearly, there was a win/win deal to be had. Some of those with knowledge of the negotiations say that Gauthier kept moving the goalposts. Others say the problem wasn’t her; it was the activists who kept pushing for more and more, until she lost control of them. Indeed, much of the activist rhetoric has recently turned on Gauthier, though she emailed me that “We are not affiliated with any organizing efforts at this site. We have and will continue to communicate with Townhomes residents, as they are our constituents, and will continue our work to support them on a variety of constituent matters as a core function of our office.”

“I am consistently one of Council’s biggest champions of affordable housing, and throughout my tenure I have been unafraid to challenge the status quo,” Gauthier went on to write. “Affordable housing legislation I have fought for includes: the Mixed-Income Neighborhood Overlay District, the Eviction Diversion Program, and the Emergency Housing Protection Act. Another of these accomplishments was the passage of the Affordable Housing Preservation Overlay District (AHPOD), which preserves and promotes affordable housing in the University City area (including the Townhomes site).”

Of course, that last one is why we’re all here, folks. It’s the spot zoning law that specifically targeted and ultimately torpedoed the Townhomes deal, which we’ll get to. Even before Gauthier blew it all up, the negotiations had their sticking points. I’m told that the fact that National was offering spanking brand new apartments wasn’t enough — there needed to be more three bedrooms offered. But the dealbreaker was what was described to me as an “exorbitant” demand by residents for payment — presumably a lump sum to each family — on top of the moving expense costs.

Get ready, folks — this is just the canary in the affordable housing coal mine. Thousands of city units will also soon be coming on the market, as other HUD contracts expire.

No one would tell me what that figure was, but the activists themselves publicly call for $500,000 per family on their own website. “Given the history of the land being twice stolen, once from Indigenous peoples during colonialism, and once from the Black homeowners of the Black Bottom in 1968 through eminent domain, we demand financial compensation for all residents being forced from their homes,” write the activists on

No one connected to the negotiations would say that $500,000 was the demand, but if it was, Gauthier had to know it would be a dealbreaker. And she didn’t just throw up her hands, walk away, and allow the City to continue to try and work something out. No, she used her councilmanic prerogative powers to pass the aforementioned spot zoning law, effectively barring the developers from razing the townhomes and redeveloping the site, as they’d been entitled to. She’d done what many inexperienced negotiators do: Get up from the table and go home.

That prompted a lawsuit claiming the developer’s constitutional rights had been violated. As I’ve written before, IBID’s brief in that case is actually the best description yet of the way councilmanic prerogative makes a mockery of representative government. IBID’s suit targeting Gauthier personally has since been thrown out, but its litigation against the City continues.

So let’s be clear where we are now: Instead of a life sciences lab producing local jobs and potentially more neighborhood affordable housing than before, there is the possibility — slim, I think — that residents could be evicted next month and, while the litigation drags on, the site of the UC Townhomes will sit there, an eyesore, undeveloped, and an invitation for blight — while protestors carry placards blaming Penn, an uninvolved party. This is what progressivism has wrought?

Ah, yes, Penn.

The protestors make the case that, historically, Penn has been complicit in gentrification and displacement in West Philly. There’s no question there’s an element of truth in that: In the mid-20th Century especially, Penn seemed afraid of its neighborhood and was closer to occupying force than fellow citizen. But when they link that history to the UC Townhomes site, protestors enter into wishful thinking land.

Yes, the City — not Penn — used eminent domain to decimate the neighborhood known as Black Bottom, where UC Townhomes sits; trouble is, that displacement happened in the late 60s, and UC Townhomes — built for the express purpose of providing affordable housing — didn’t go up until the 1980s, an arrangement between the federal and city governments and the private sector.

Magill challenged her staff with a critical question: “How can we help solve this?”

Sometimes facts are inconvenient things. But you won’t hear the progressive protestors on Penn’s campus acknowledge that. Instead, the outrage over UC Townhomes is time and again linked to the populist call for Penn to pay PILOTS — Payments In Lieu of Taxes, thereby tipping the ideological protestor hand: They see an institution with a lot of money, and believe a show ought to be put on of it being redistributed.

That makes for good performative posturing, but it doesn’t really work if you’re sincerely in pursuit of solutions. Fact is, Harvard’s PILOT payments total all of roughly $10 million. Would you rather impose that on Penn, or maybe be happy with its $100 million contribution to the School District, the largest single gift in district history?

Boston doesn’t have a wage tax; here, though, something like 8 percent of the city budget comes from wage taxes paid by Penn’s workforce, the city’s largest. I’ve long argued we should retire the tired debate over PILOTS and instead focus on SILOTS: Solutions In Lieu of Taxes. Ask our great educational institutions to marshall together their best and brightest minds to come up with creative fixes to our most intractable problems.

Well, the UC Townhomes saga might just serve as the catalyst for such a game-changing reorientation. I’m told that, after her experience being jeered and silenced at Convocation, Magill challenged her staff. The notion, demanded by the protestors, that Penn ought to just buy the property was, of course, a non-starter, because it doesn’t align with Penn’s mission.

But Magill asked a critical question: “How can we help solve this?” She asked her staff to start considering what is the appropriate role for a private university in these most public of controversies.

It’s a question that aligns with what she’s signaled to Philly’s civic, business and political leaders in her short time in town. She’s been conducting multiple Zoom meetings with movers and shakers each week. I hear from them that she’s been unequivocal, and consistent with what I heard her say this week at an on-campus gathering of civic leaders: “My message to you tonight is simple,” Magill said. “Penn is here, Penn is a ready partner, Penn wants to do everything it can to advance the life and success of Philadelphia.”

What form will that enhanced sense of civic engagement take? Perhaps a hint lies in something Magill founded when she was Dean of Stanford Law: the school’s Law and Policy Lab, an incubator for students to work on solutions for real world clients on issues ranging from equity in education to poverty to housing.

Could something like that be in our future? Already, I’m told, the UC Townhomes fiasco has led the president’s office to engage in talks with entities like University City District, the Penn Institute for Urban Research, and Rebuilding Together Philadelphia, which transforms vulnerable houses into safe and energy-efficient homes. The idea is to come up with a proactive, interventional plan in advance of the tsunami that is to come: Some 1,700 other federal affordable housing contracts are coming due. UC Townhomes is only the tip of a catastrophic housing iceberg.

Gauthier was right when, asked about UC Townhomes, she said it’s an “injustice to simply stand by and watch while low-income people, working-class people, and people of color… are pushed out.” It is a terrible thing.

But civic problem-solving requires a wide lens. Magill’s instinct ought to be instructive: How can we help? Policymakers like Gauthier need to similarly adjust their aperture. Gauthier says she learned a lot from a Council hearing she held six months ago about the prospect of more UC Townhomes in our future, and that the answer will lie in collaboration with federal and state partners. “While I am committed to working out solutions at the City level, we look forward to partnering with our colleagues for a comprehensive answer to this problem,” she writes.

The recognition that it’s going to take collaboration and, presumably, compromise is a welcome sign. Meantime, as it pertains to UC Townhomes, one has to wonder if the same mindset was brought to bear.


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