40th Street corridor prepares for facelift

With Freshgrocer.com and Sundance opening, officials see a commercial boom on 40th St. With both the Sundance Cinemas complex and the Freshgrocer.com complex about six months away from opening on the western edge of campus, officials are predicting a transformation that will leave 40th Street looking nothing like it does today. Penn and University City District officials hope that over the next three years the 40th Street corridor will become a lively commercial zone, home to coffee shops, restaurants and clothing stores, that will serve as a magnet for the University community, area residents and people from throughout the Philadelphia region. Officials expect that when the cinema and specialty foods market open, the businesses to fill the rest of the corridor will follow suit. "I think within a year after Sundance and the market opening you will see existing, unutilized storefronts becoming active again," said Tom Lussenhop, the University's top real estate official. The corridor runs from Baltimore Avenue in the south to Filbert Street, just north of Market Street. For years it has stood as an imaginary boundary between the University and West Philadelphia. Penn had been toying with ideas to revive the western end of campus for years before being approached by movie mogul Robert Redford to open up the the first of his chain of independent movie theaters. A year ago, officials approved plans to begin construction on the eight-screen Sundance Cinemas complex just across Walnut Street from the site designated for the Freshgrocer.com complex, a specialty foods supermarket topped by an 800-car parking garage. But while most of the reaction has been positive, some community leaders fear that the project will lead to higher rents for storefronts -- forcing current tenants out and replacing them with upscale retailers focused only on the University market. "There are clearly members of the community who think the [Freshgrocer.com complex] and the cinema will be wonderful, but there are others who don't think it will be something for them," explained John Betak, former president of the Spruce Hill Community Association. But Barry Grossbach, current president of the Spruce Hill Community Association, said the reaction from residents in his community has been largely positive. "There's a general feeling that it's going to be a tremendous asset," Grossbach said. "It will be a boost for the area as an entertainment district." Still, students are concerned that the 40th Street corridor will be like previous University retail projects -- too expensive for the average student budget. "There's a genuine concern among the student body that there's not enough cheap restaurants and retail options," Undergraduate Assembly Chairperson Michael Silver explained. Executive Vice President John Fry and Lussenhop said that the 40th Street endeavor will not be like previous on-campus retail development. "We recognize that 40th Street is going to be different from Sansom Common," Fry said. "[We're] looking up and down the pricing curve [and] we're not at all interested in kicking out the little guys." Unlike Sansom Common, the upscale shopping complex/hotel/bookstore that opened last year, Penn plans to take a more hands-off role in attracting businesses, officials have said. Sundance and Freshgrocer.com will serve as a "catalyst," encouraging businesses to come on their own, they expect. Fry said that the University expects a mix of small- and large-scale vendors, depending on the needs of both the University community and its West Philadelphia neighbors as assessed by prospective businesses. Grossbach said he is not afraid that the area will become a "University enclave" that serves only Penn students, a fear that community residents expressed when the plans for the project were first announced. "The University is one voice among many different voices on the choices that will unfold on 40th Street," Lussenhop said, emphasizing that the corridor will not be aimed solely at the University community. "What we're really looking for is an eclectic collection of businesses," Fry agreed, adding that such a collection could consist of hardware stores, coffee shops, boutiques and used book stores. The University is already involved in negotiations with a prospective used-book retailer for a University-owned space along 40th Street, Fry said. Penn and UCD officials also hope the increased economic activity spurred by the specialty market and Sundance Cinemas-- the only one of its kind in the nation -- will lure new businesses to the area, pushing up property values. "You will see business owners upgrading their storefronts to better take advantage of the demand there [and], over time, more substantial re-tenanting to take advantage of the new demands that will be there," Fry said. But this economic revival may not come without sacrifice. With only three percent of the storefronts along the corridor currently vacant, it is almost certain that if the University's endeavors on 40th and Walnut streets are successful, rents along the corridor will rise, forcing some current tenants to leave. Richard Hill, former vice president of the 40th Street Area Business Association and owner of University Herbs, which sells general nutrition products on the 300 block of South 40th Street, said the Association would have to deal with the prospect of some businesses being unable to afford the higher rents. He added, however, that the strongest businesses would be able to survive. "Any store that is well maintained and serves the community will be able to stay," he predicted. Some residents are also concerned that spaces which are not used for retail purposes, such as the Philadelphia Children's Alliance, a non-profit organization that deals with child abuse cases and the Consortium, a center for the education of mentally handicapped children, may be forced to close or move to other locations. Additionally, opponents of the University's plans have criticized Penn for moving ahead on the project without a coherent plan for development along the entire corridor, Betak of the Spruce Hill Community Association said. But, Lussenhop and Fry maintain that the 40th Street plan is based on a series of models that developed under similar conditions such as South Street in Philadelphia and Harvard University's immediate surroundings in Cambridge, Mass.