Philadelphia begins developer search for Navy Yard expansion, with apartments in the mix

An expanded vision for South Philadelphia’s Navy Yard will be rolled out Friday, with a plan that includes ample space for dining and shopping, millions more square feet of labs and offices, and — for the first time — an around-the-clock residential population.

The Philadelphia Industrial Development Corp. (PIDC) plans to issue a solicitation for developers to transform 12 acres boasting historic industrial buildings into a dense community of apartments, shops, and offices while using a separate 97-acre tract to partly reprise its existing business-and-research park.

PIDC wants to sustain the Navy Yard’s success at drawing new businesses to the former military base by attracting a critical mass of full-time residents who can support a level of retail and services that daytime crowds alone can’t sustain, said Prema Katari Gupta, the city-affiliated nonprofit’s senior vice president for the Navy Yard.

“We exist to attract talent to Philadelphia and to the Navy Yard,” she said, “and the workforce is demanding more things to do.”

The Philadelphia Navy Yard, which employed 40,000 at its peak, came under city ownership in 2000 after the U.S. Defense Department decommissioned the site as a military base.

Under PIDC’s watch, developer Liberty Property Trust turned a centrally located 80-acre section of the Navy Yard into what’s known as the Corporate Center, a collection of contemporary buildings — some by renowned architects — comprising 800,000 square feet of office and lab space.

Tenants include British pharmaceutical giant GlaxoSmithKline PLC, the Chinese biotech firm WuXi AppTec Inc., and homegrown financial firm FS Investments.

When Liberty decided to cease work on office projects such as those at the Navy Yard last October, nearly all of the Corporate Center’s development parcels had been built on or spoken for. Developer John Gattuso, a former Navy Yard executive, is working on one of the final projects there, a 136,000-square-foot office and laboratory complex for cancer-therapy firm Iovance Biotherapeutics Inc. of California.

Other remaining spaces in the core area are being set aside for a short-stay apartment building to be developed by Ensemble Investments LLC of Phoenix and as potential expansion sites for FS Investments and Adaptimmune Therapeutics PLC, another biotechnology firm, PIDC President John Grady said.

A historic barracks building within the Corporate Center’s boundaries, meanwhile, is to be converted into an upscale hotel. And the Navy Yard has a separate industrial zone that’s home to businesses such as Tasty Baking Co. and the RevZilla.com online motorcycle-gear store.

But much of the Navy Yard’s 1,200 acres still feels untamed or abandoned, especially after hours and on weekends, with deer dashing freely across parade grounds and decorative carp swimming through the flooded entrails of a former warehouse.

PIDC is now hoping to change that.

Part of its plan would transform a 12-acre site northeast of Urban Outfitters Inc.’s headquarters campus into what it hopes will become the Navy Yard’s “downtown,” according to an advance copy of the developer solicitation that was shared with The Inquirer.

The Historic Core District, as it’s being called, is largely bounded by 11th and 12th Streets, between Flagship Avenue and Normandy Place.

It is seen as accommodating 1,000 to 1,500 apartments in restored buildings, such as the former warehouse with fish in the basement and newly constructed ones, along with restaurants and shops to serve residents and nearby office workers and lab techs, Grady said.

The dwellings are permitted thanks to a recently concluded deal with the U.S. Navy that relaxes deed restrictions on the base that barred housing there. The restriction had been in place since the Navy Yard entered city ownership.

The other site in PIDC’s new development push is being called the Mustin District, after the former Henry C. Mustin Naval Air Facility airfield that once occupied much of the tract. Its 97 acres extend east from League Island Boulevard, bounded by the waterfront, and the Navy Yard’s near-northern border.

PIDC describes the tract in its solicitation as “largely a blank canvas for redevelopment,” calling on developers to clear the site of existing obsolete structures there before starting construction. The tract does not include the historic Mustin Field Seaplane Hangar building, which sits outside the PIDC’s section of the Navy Yard.

Grady said the Mustin District could support as much as three million square feet of new office, lab, and production space, emulating the Corporate Center’s atmosphere. But it could also potentially accommodate residential buildings along its quarter-mile waterfront, he said.

Developers have until Nov. 22 to respond to the solicitation with proposals for the sites, after which a shortlist of candidates will be selected to present further details of their plans. PIDC will decide whether to divide the sites among multiple developers or work with a single team after reviewing responses, Grady said.

“We really want to hear from the market,” he said. “The idea is to think in terms of districts.”