By Alan J. Heavens
March 17, 2015

The Inquirer

REAL ESTATE

When developer Ken Weinstein meets with prospective tenants for his commercial buildings, he says, the first question they ask is “about the condition of Germantown,” the historic Northwest Philadelphia neighborhood where decades of disinvestment continue to take a toll on housing.

Weinstein, whose focus as a commercial redeveloper makes him acutely aware how blighted blocks can affect nearby businesses, said Monday that he was launching “Jumpstart Germantown,” an effort to push residential redevelopment “to where it should be.”

The plan, expected to get underway in April, is to “unleash a force of small residential developers to renovate properties throughout the neighborhood,” he said.

Weinstein has developed residential and commercial sites in the region for 25 years and has proposed a controversial renovation of the Germatown YWCA into affordable senior housing. His firm, Philly Office Retail, has rehabbed more than 200 vacant and deteriorated properties and manages 600,000 square feet-plus of commercial space.

There are three pieces to “Jumpstart Germantown,” which he believes could result in returning 50 residential properties at a time to the market:

A mentoring program with at least eight small developers, to be held at least three times a year.

A small-developers network that, among other goals, would get rehabbers and investors communicating, Weinstein said. “We don’t talk to one another, and there is no reason for it. We are not in competition.”

And financing, namely a $2 million credit line from JPMorgan Chase that he said would be parceled out to the small developers to acquire and renovate homes for sale or as rental properties. “Financing is the biggest obstacle for small developers,” he said, adding that details of the program would be worked out soon.

There will be no government involvement, he said: “Government partnership slows us down, and the strings attached tend to hold us back.”

Nor will there be appraisals involved in property acquisition. “We know these neighborhoods,” Weinstein said.

Loretta Witt of Berkshire Hathaway Home Services Fox & Roach Realtors, who has lived in Germantown for 45 years, welcomed the plan, saying neighborhood residents should “feel good about this transparent, smart, long-term, goal-oriented approach” to revitalization.

“Development is good,” Witt said. “Private investment in our neighborhood is good. PHA [Philadelphia Housing Authority], with the federal government, is developing homes at Queen Lane and Pulaski Avenue. That is good. Our residential blocks are all the better for this investment.”

Garlen Capita, president of Germantown United Community Development Corp., called the plan “a great opportunity and much needed,” noting that “there is not a lot of organized effort” in residential redevelopment.

“This would be the start of something that would result in long-term investment and growth,” Capita said.

Even what looks like progress can be fleeting. Her street, long on the upswing, suffered a setback when three houses went into foreclosure. “It is an economically difficult situation,” she said; stabilization through the program will help.

In an improving real estate climate, investors are at work in Germantown, “but giving them added resources should increase activity, resulting in more properties being rescued and rehabbed,” said Ruth Feldman of Weichert Realtors McCarthy Associates, who sells there.

The effort will “lead to an influx of new residents, which should lead to increased and upgraded commercial activity, which will spur more investment/demand,” she said.

Capita said the program targets not the big guys, but people “like the police officer on my street who invests in properties.”

That includes developers such as Nancy Deephouse, a part-time math teacher who lives in the neighborhood. She started rehabbing properties in 2009 with a condo in the Art Museum area and has done a couple Germantown projects.

“I’ve always been interested in being in business for myself, and in the design elements of real estate,” said Deephouse.

And also Bruce McCall of Mount Airy, a systems administrator who has been dabbling in real estate since 2005, when he bought a duplex he currently rents out.

McCall said that his efforts “have everything to do with the customer,” whether buyer or renter, and that when he decides what a renovation should entail, “he puts himself in the buyer’s shoes.”

Witt said the effort will encourage responsible development in Germantown: “We want investors to say: ‘Yes, I am entering a neighborhood of good citizens, and to the best of my ability, I will develop/renovate a house of which both I and the community can be proud.’ ”

PROGRAM HIGHLIGHTS
There are three elements to “Jumpstart Germantown”:

  • A mentoring program with at least eight small developers at a time, to be held at least three times a year.
  • A small-developers network that would get rehabbers and investors communicating.
  • Financing, namely a $2 million credit line from banks that will be parceled out to the small developers to acquire and renovate homes for sale or as rental properties.

aheavens@phillynews.com
215-854-2472 @alheavens

Copyright © 2016 PhillyOfficeRetail