Society Hill Civic Association has signed an agreement with the Alterra Property Group which was finalized this week.
Two neighbor groups that have appealed Alterra’s prior permits are also party to the agreement. The agreement pertains to the commercial properties owned by Alterra on either side of 5th Street just south of Spruce including the ACME supermarket and the three store commercial building across from the ACME.
Negotiations for this agreement have been ongoing for a number of months. SHCA has regularly informed and sought feedback from the Society Hill neighborhood on the key points of the agreement through several neighborhood meetings and periodic emails. The signed agreement reflects the key points that have been previously communicated through these meetings and emails and contains nothing new.
As part of the settlement with SHCA, Alterra has signed an agreement to extend the ACME supermarket lease by 10 years with options for another 19.5 years. The lease agreement gives ACME the right to build a roughly 2,500-square-foot 1-story addition to the 12,000-square-foot existing supermarket. ACME also has the option, if and when it chooses to use it, to demolish the existing building and rebuild a new one of 13,500 square feet at the same height. We have no information as to whether or if ACME will pursue either of these two options.
Also, under the terms of the agreement with SHCA, Alterra has agreed to legally abandon permits it held for a mixed use residential and commercial project on the ACME supermarket site that was strongly opposed by Society Hill residents and which would have drastically reduced the size of the existing supermarket, as well as adding significant height and mass to the building.
SHCA has also agreed not to oppose Alterra’s plans for a CVS to be located on the property across the street, which is currently home to a liquor store and other shops.
During our redevelopment period, the commercial buildings on 5th Street were carefully sized to fit into Society Hill’s historic character, with a full-service supermarket being at the heart of the neighborhood. In reaching this agreement, SHCA was guided by the Society Hill community’s desire to retain a full service supermarket at this location and its opposition to new construction that would have been out of scale with the surrounding homes.
This week’s agreement means that a full service supermarket and the current building height and mass (with the exception of the 2,500 square foot potential addition) will likely be maintained for the foreseeable future. It also means that the opposite side of the street will remain a one story building, a scale that Society Hill residents think is appropriate for the site. While we agree that the loss of the three stores will be unfortunate, it is part of the overall compromise needed to achieve this positive result.
We cannot predict what the future will hold. Much of it depends on market conditions, including in the supermarket industry, and the decisions of others, but we remain optimistic. This has been a huge endeavor for SHCA and the entire neighborhood. We appreciate your involvement to help us through this process, and your passion for and dedication to this historic neighborhood.
May 26, 2017
Society Hill Civic Association presented the following news on the 5th Street Development at three meetings in the last two weeks: on Monday, May 10th at St. Peter’s Parish House (the meeting was moved to Old Pine Church) and at the Board and General Membership Meetings last week Wednesday, May 17th at Pennsylvania Hospital.
SHCA has entered into settlement negotiations with the developer, Alterra for both sides of the commercial district on 5th Street between Spruce and Pine Streets. Alterra, which now has ownership of both sides of 5th Street at this location, has proposed the following development:
– Keeping the ACME store on the east side of 5th Street with no change to the height of the building
– Entering into a long term lease with the ACME
– Keeping the exterior of the ACME building the same except for giving ACME the right to build a one story 2,500 square foot addition on the north side of the building (facing the parking lot)
– Entering into a long term lease with CVS for use of the entire building on the west side of the street — the existing stores (State Liquor Store, Food & Friends, and the dry cleaners) would not remain
– Keeping the building on the west side of the street the same except for an 11′ by 32′ “bump-out” on the back of the building near Cypress Street (the northwest corner)
The details of the Settlement Agreement are still being worked out. Once the Settlement Agreement has been approved by the three appellant groups (SHCA, and two groups of near neighbors represented by two different attorneys), we will notify the community. Note: the SHCA Board approves agreements on behalf of the association.
Alterra has filed for three zoning use permits to develop the ACME site since it signed its 2015 Agreement of Sale, the most recent having been filed in November 2016. The SHCA was not given notice of the November filing or the granting of the permit until after the permit was posted on the supermarket and neighbors began sending photos of the permit to the SHCA on January 13, 2017. (This conditional permit moots the prior zoning use permits granted to Alterra.)
The November 2016 permit plans include the demolition of the existing building and the erection of a new, five-story, 53-foot-high building with 65 apartment units on the second through fifth floors and a 43-car underground parking garage.
When neighbors noticed the conditional permit posted on the ACME supermarket on January 13, Society Hill residents had been waiting for the result of long-term lease negotiations between ACME and the developer that were announced by Councilman Mark Squilla at a SHCA General Membership meeting in March 2015.
Between March 2016 and November 2016, the SHCA checked regularly with the developer’s attorney and the councilman about the status of the negotiations. We were told by the developer’s attorney that good faith negotiations were ongoing, that these things take time, and that we should be patient. In this context, the SHCA repeatedly granted extensions to the developer for the hearing on the February 2016 zoning use permit appeal that the SHCA had filed in March 2016.
Under the current CMX-2 zoning for the ACME site, the maximum building height allowed is 38 feet and the maximum number of units is 47. However, the developer used two “bonuses” to get more height and more density.
CMX-2 zoning also requires that the first floor be used for commercial space. The developer included in the plans filed with this permit, a large space labeled “Retail Space” and a much smaller space than the current full-service supermarket labeled on the plans as “Fresh Food Market”. Any space no matter what size that uses “50% of the display space for fresh fruit and vegetables” gives the developer 15 extra feet in height. There is no minimum space for the overall size of the food market required under this code provision, nor is any proof required of a long-term lease with a fresh food retailer.
On the drawings, the developer shows a fresh food market of 3,124 square feet; by way of comparison, the size of the current ACME market is 12,599 square feet. The Code allows a height bonus for “new” or “expanded” markets and the City apparently decided that this would be a new market.
The green roof bonus formula gives the developer 38% more density, which in this case is 18 more dwelling units than he would get with the “base zoning”. At our request, Councilman Squilla has been working to exempt Society Hill from the green roof bonus based on the importance of maintaining current density in our historic district. The bill exempting Society Hill from the green roof bonus will be introduced Tuesday, March 14, 2017, at 10:00 AM before the City Council Rules Committee in City Hall Room 400.
The SHCA’s outside attorney reviewed the plans for compliance with the Zoning Code. The SHCA in consultation with its attorney, and with Board approval, challenged the permit by filing a timely appeal on February 10, 2017 to the Zoning Board of Adjustment. There is no hearing date set yet. Two groups of near neighbors also filed appeals. Our understanding is that ACME’s current lease expires in April 2018. In addition to obtaining a final zoning permit, the developer will need to go through the Historical Commission review process and the Civic Design Review process, the latter which is triggered for projects of this size. The Civic Design Review is advisory only. We will keep you informed as things progress as we have done since May of 2015 when the developer first surprised the community at the May Zoning & Historic Preservation Committee meeting with plans to develop the ACME site.
A proposed development of the ACME store site on 5th Street has resulted in widespread organized opposition by the Society Hill community because of the potential loss of a long-time full-service supermarket and the inappropriate scale of the building for an historic district and relative to the residences surrounding the site. Alterra Property Group, LLC, has received a conditional permit to demolish the ACME supermarket building and construct a five-story building with retail space on the ground floor and 65 dwelling units above.
The ACME supermarket exists in a commercial shopping district that was created during the redevelopment period of the 1960s in order to support the homeowners restoring the housing of an historic neighborhood that dates back to the nation’s earliest history. The full-service supermarket remains a highly important resource for Society Hill’s dense population of residents, many without cars. Of equal concern to the community are the height and mass of the project that would loom over a dozen three-story homes that line the northern and eastern boundaries of the site, and that is out of scale with one of the nation’s most historic districts.
In 2016, SHCA raised approximately $32,000 for legal and other expenses related to the 5th Street development. Donations are currently being accepted for this purpose. Click here to DONATE.
Redevelopment Authority of Philadelphia creates the 5th Street shopping district to serve the residents of the historic district.
City of Philadelphia changes the zoning to CMX-2, allowing 38 feet plus height and density bonuses. The old zoning classification “Neighborhood Shopping District” is deleted from the new zoning code and zoning automatically becomes CA-1. The City then “correctively” zones property to CMX-2, even though SHCA testified against the change because CA-1 more closely resembles the existing use of the site.
ACME property is under contract for sale to Alterra, a developer.
Alterra presents three plans for development to SHCA Zoning and Historic Preservation (ZHP) Committee. Neighbors were not notified because the committee was not told that plans were being presented.
SHCA hires attorney Richard DeMarco.
SHCA holds community meeting on proposed development.
Alterra gets a Zoning Use Permit for a 5,719-square-foot addition to existing building at ground level, plus two additional stories above.
SHCA appeals the Zoning Use Permit because it did not conform to all provisions of the Zoning Code. Another SHCA community meeting is held to discuss status of appeal.
Alterra purchases the ACME property and withdraws first permit. Alterra gets a second Zoning Use Permit for demolition of existing building and construction of 38-foot, three-story building with 38 apartments above retail space.
SHCA appeals second Zoning Use Permit because it did not conform to all provisions of the Zoning Code.
Councilman Squilla announced at the March 2016 SHCA general meeting that Alterra advised him that Alterra was negotiating with the parent company of ACME for a long-term lease of 20 years or more. Alterra advised the Councilman that if the lease is extended, the building would not be redeveloped.
SHCA checked periodically with Alterra’s attorney at Ballard Spahr and with Councilman Squilla about the status of the negotiations. SHCA is repeatedly told the negotiations are proceeding and the Association should be patient. On that basis, SHCA agrees to give Alterra multiple extensions on the appeal of the second Zoning Use Permit.
When SHCA checks in with Alterra on November 11, its attorney tells SHCA that negotiations are proceeding in “good faith.”
On November 29, Alterra applies for a new permit to demolish the building and construct a 53-foot, five-story building with 65 apartments and 43 underground parking spaces.
Neighbors notice a new permit posted on the ACME to demolish the existing building and construct a new development on the site. Later that day, Alterra’s attorney sends SHCA a letter notifying the Association of the permit.