Penn's expansion east may be on hold

With the U.S. Postal Service facing financial turmoil, the University's planned development on the lands now occupied by the 30th Street Post Office may have to wait longer than expected. According to University officials, the Postal Service -- which owns the lands near the Schuylkill River -- has delayed its planned move to the Philadelphia Processing and Distribution Center, which is to be constructed next to Philadelphia International Airport. "With the Postal Service losing about $3 billion a year, they have put a nationwide freeze on all capital projects in their system, including their new facility in South Philadelphia," University spokeswoman Lori Doyle said. But Postal Service officials denied that the proposed relocation has been canceled. The move is "not affected," according to Postal Service spokesman Ralph Stewart. "That's not to say in the future it might not be, but as of right now, it's not affected by the freeze." On March 8, the Postal Service -- a private enterprise that operates as part of the federal government -- announced that it is "facing a potential loss of $2 billion to $3 billion this fiscal year." According to the statement, the Postal Service Board of Governors decided in a meeting on March 7 to "take unprecedented action on additional cost-control options, including an immediate freeze on capital commitments that will affect over 800 facilities." While the new distribution center in South Philadelphia was not on the list of frozen projects, the statement did warn that the list "is subject to change." According to the University's new Campus Development Plan, Penn ultimately plans to build a biomedical complex on the postal lands, which straddle the west bank of the Schuylkill River. And while the plan aims for a long-term eastward extension of campus, the Postal Service has indicated that the move of the 30th Street Post Office is still far in the future. "We still have a long ways to go before that site is up," Stewart said. A former city official familiar with the Post Office's planned relocation noted that the Postal Service has acquired the property for the new distribution center, but is in the process of assigning contracts. But the source, who spoke on the condition of anonymity, said that the recent financial trouble has halted that process temporarily. "There has been a temporary moratorium, so that they can prioritize all the different capital projects," the source said. The official did, however, note that the Postal Service's interests would be best met by pursuing the move. "The modernization of facilities are major initiatives that they need to complete sooner rather than later," the source said. The source acknowledged that the city is deeply committed to ensuring that the postal lands are eventually redeveloped. Earlier this month, the Delaware River Port Authority approved $830,000 to aid in the development of lands around 30th Street. "None of us at the table want to see the situation transpire where the Postal Service vacates the property without a redevelopment plan," the source said. Jack Shannon, Penn's Managing Director of Economic Development, has indicated that the University is prepared to do what it takes to ensure a smooth transition for the Post Office. "We are committed to working with the Postal Service and other stakeholders within the parameters of the Postal Service's development needs to achieve a win-win situation," Shannon said.