The Top Real Estate Stories of 2024
The controversy over the proposed Sixers arena dominated the headlines, but there were some other developments — or lack of them.
A rendering of the proposed 76 Place arena from December 2023; the apartment tower in the background has since been deleted. The arena cleared a key hurdle in November, but the fight over the project continues. / Rendering via 76 Devcorp
This year was a relatively calm one on the real estate and development front in Greater Philadelphia. But one development in particular has generated a lot of heat — enough to melt any snow that falls this winter. That project leads our list of top real estate stories for 2024. Everything else is a distant second.
1. 76 Place heads for the key
The fight over the Sixers’ proposed arena in Center City entered Year Three this summer. While the arena proposal just recently cleared a key hurdle, anyone around here who’s familiar with Center City entertainment-facility fights should know that this one’s far from over.
The proposed 76 Place arena has some powerful supporters, none more powerful than Mayor Cherelle Parker. She won office with the backing of the city’s construction trade unions, and this project would pay them back in a big way for their support. But it also has some tenacious opponents in the form of Chinatowners who managed to beat back a similar proposal for a Phillies ballpark at the neighborhood’s northwest corner.
Both the Chinatowners and Thomas Jefferson University Hospital fear event-related traffic would cause trouble. Chinatown opponents fear it would keep regulars from patronizing Chinatown restaurants, while Jefferson worries it would hinder ambulances headed for the Jefferson emergency room. The Chinatowners also worry that, as happened in Washington, the arena could cause real estate prices to jump, thus gentrifying the neighborhood out of existence.
And finally, SEPTA worries about both the cost of providing additional transit service for fans and the problems it could cause with the way Jefferson Station functions, as that station is integrated with the Fashion District mall.
While this fight is reminiscent of that 2000 one over the ballpark, City Council’s vote to clear the way for the Sixers to build on the Fashion District site takes it closer to reality than the ballpark ever came. But as the shouting continues, at least to this observer, the Disney hole looks better as a fallback with each passing day.
The 30th-floor roof deck at 210 South 12th. Its 376 apartments account for a small fraction of the nearly 13,000 that were slated to open this year. / Photograph by Midwood Design Studio
2. New apartments continued to flood the Center City market …
New apartment buildings continued to open at a torrid pace this year in what the Center City District calls “Greater Center City.” According to a March 2024 RealPage forecast, some 13,000 new apartment units were slated to come online last year. Notable contributions to that total included 1001 South Broad, the first phase of a multi-building development from Tower Investments and Post Brothers; The Josephine, Southern Land Company’s more modest follow-up to The Laurel/1919 Rittenhouse; The Noble, the latest addition to the burgeoning Spring Garden Street apartment row on the edge of Northern Liberties; and 210 South 12th, the tallest apartment building in Philly’s Gayborhood.
Since most of these buildings cater to the upper end of the market, one might wonder whether their owners could fill all the units. An October Philadelphia Business Journal article stated that landlords have managed to fill those new buildings, with 77.4 percent of the new units offered from 2020 to mid-2024 occupied. Most, however, resorted to promotional offers like free months of rent to fill them.
And all this construction has caused overall vacancy rates to rise in parts of the city. CoStar figures cited in a Global Real Estate Advisors report stated that as of last summer, vacancy rates in Philly’s upscale neighborhoods stood at 12.7 percent, about 3.5 percentage points above the regionwide average. This, in turn, has caused average rents to fall in the city. Apartment List reports that as of the new year, median rents stood 1.1 percent below 2023 levels, and overall rent growth for the year in the city was -0.5 percent, a sharp change from last year’s 1.2 percent rise.
At least one large landlord has made a move that aims to both fill its buildings and give working stiffs a break. Upscale developer and property manager Post Brothers currently offers healthcare, hospitality, city government and education workers a $1,000 credit towards their monthly rent at several of their newest developments.
As the pace of new apartment building starts in Philly fell 55 percent in 2024, the apartment market should stabilize over the next two to three years.
Scenes like this one from five years ago are a good deal less common in Philadelphia as new home construction continues to decline thanks to higher interest rates on top of a reduced property tax abatement. / Photograph by Madison Stringer
3. … while home construction continued its slide in the city
One reason the pace of apartment construction picked up: The full 10-year property tax abatement remained in force for commercial buildings in 2021 but was cut by 10 percent the next year. The buildings now rising obtained their abatements before the cutoff took effect, and thus we can expect the pace of apartment construction to cool down significantly in 2025 and beyond.
The overall pace of home construction in Philly had already cooled off the year before, when the halving of the city’s residential construction abatement took effect. Interest-rate hikes that affected local construction projects cooled it even further in 2024. Preliminary figures from the U.S. Department of Housing and Urban Development show that the city issued building permits for 2,463 residential units in 2024, a drop of 1,400, or 36 percent, from 2023’s figure. (For comparison, permits issued throughout the metropolitan area through October stood only 8.9 percent below last year’s number.)
Taken together, these two trends mean that while more affluent Philadelphia renters will enjoy many units to choose from, would-be owners up and down the income scale will find slimmer pickings.
The area and city housing market has stabilized in the last two years, but rising house prices remain a worry for some would-be buyers. / Getty Images stock photo
4. Prices rise, but the housing market holds steady.
While Philadelphia remains one of the most affordable housing markets in the Northeast, homes hereabouts got a little less affordable in 2024. As of November, the Redfin online brokerage reported that the median home sale price in the city stood at $260,000, up nearly 21 percent from a year ago. Inventory rose from the previous year, but the number of homes sold fell by 7.5 percent.
Areawide, Realtor.com data reported by the Federal Reserve Bank of St. Louis’s FRED economic data site show median list prices also rose 6.4 percent from year-ago levels in November, to $372,500 from $349,900.
These stats, however, do not point to a cooling or a heating housing market. Houses here sell for close to their asking price in a reasonable amount of time: 48 days on average as of November.
