Fed up with mess the Reading Railroad left behind, Callowhill developer seeks oversight of Spring Garden train station | Inga Saffron

It’s been almost 40 years since the last passenger train rolled into the Reading Railroad Headhouse on Market Street, but the company’s viaduct still defines the Callowhill neighborhood on the northern edge of Center City. Residents dream of transforming the immense stone-and-steel structure into an elevated park — a Philadelphia version of New York’s High Line. Drawn by the prospect of that amenity, developers have flocked to the neighborhood, renovating old factory buildings, and filling in the empty lots with new housing.

But the reality on the ground is much different. In the two decades since a small group of residents first proposed turning the viaduct into a ribbon park, Reading Railroad’s old right-of-way has instead become a ribbon of blight. Its Spring Garden Street train station, which is still owned by Reading International, is a magnet for illegal dumping, homeless encampments, and drug use, according to Kelly Edwards, who manages community relations for Arts + Crafts Holdings, a local developer, and serves on the board of the Callowhill Neighborhood Association. As the pandemic has dragged on, she says, “the illegal activity has gotten worse.”

Attempts to get the city to hold Reading accountable have gone nowhere, Edwards said. A neighborhood effort to form a business improvement district to combat the dumping and drug use also failed last year. Now Arts + Crafts, which recently converted the former Reading offices at 915 Spring Garden in offices and artist studios, has decided to take matters into its own hands. Partnering with a blight-fighting nonprofit called Scioli Turco, it has filed a petition in Common Pleas Court seeking control of Reading’s train station so it can clean up the mess itself.

The lawsuit is the latest attempt to use Pennsylvania’s decade-old Act 135 statute to do what many local governments seem incapable of doing: enforcing their property maintenance laws. If Arts + Crafts and Scioli Turco are successful, and their plan is approved by a judge, they would be named conservators for Reading’s train station. Although they would not assume ownership of the property, they would be empowered to make repairs at Reading’s expense. If Reading refused to cooperate, they could ask the court for permission to sell the property and use the proceeds to cover the costs of the repairs. (Reading would receive whatever money remained.)

Scioli Turco has used Act 135 to clean up dozens of neglected buildings around the city, including the asbestos-ridden, former steam plant a few blocks east of the viaduct, at Ninth and Willow Streets. In that case, Scioli Turco acted as a kind of overseer to ensure that the building’s owner, developer John Wei, carried out an approved remediation plan. The work was completed last year, and Wei told the court he now plans to convert the longtime eyesore into apartments.

Gaetano Piccirilli, the lawyer who represented Scioli Turco in that case, and is now handling the Act 135 petition against Reading International, said he is hoping for similar results for the Spring Garden station building, near the corner of Ninth Street. “Act 135 gives the owner the opportunity to do the right thing, and that is always the preferable outcome,” he explained.

At the same time, some Callowhill activists hope that employing such an extreme measure as Act 135 could be the push that Reading needs to finally do something with the assortment of derelict properties it owns along the viaduct, which stretches from Vine Street to Fairmount Avenue. While Reading hasn’t functioned as a railroad since it declared bankruptcy in 1976, and its operations were absorbed by Conrail and SEPTA, it has evolved into an international entertainment company and owns a massive portfolio of real estate.

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Maybe because it controls so much property around the world, Reading International seems content to sit on the vacant land it owns around the viaduct. During former Mayor Michael Nutter’s administration, city officials flew to Los Angeles to meet with Reading executives to try to open discussions about transferring the viaduct into public control but made little progress.

Even after the city completed a tiny segment of the Rail Park in 2018 — effectively a gateway to a future high line park — the company remained mum about its plans for its Philadelphia holdings. Reading CEO Ellen Cotter did not respond to my e-mailed request for comment on the Act 135 petition.

Part of the problem is that the company, which was believed to be worth $1 billion before the pandemic, has been consumed for years by an internal power struggle between members of the Cotter family, who own a controlling stake, and other shareholders. According to a knowledgeable source, some shareholders want Reading to sell off all its real estate, while others believe it can gain more by developing the properties itself. Reading just turned the former Tammany Hall building on Union Square in New York into luxury offices called 44 Union — 18 years after acquiring the property.

The Callowhill neighborhood has been forced to bear the fallout of those distant squabbles. The once-handsome, early 20th-century train station at 901 Spring Garden is now roofless. It has become an encampment of drug users who often use the sidewalks as a restroom, according to Edwards. The Act 135 petition estimates that it will cost $450,000 to clean up and stabilize the building. The budget includes $20,000 to help treat and relocate the people living in the old station.

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Reading did make one improvement recently at the old train station. After a pedestrian was injured in a fall and filed a lawsuit, the company installed a chain-link fence around the building’s ground floor. That did little to keep squatters out at the viaduct level, Edwards said. But the chain link has become a major collector of trash.

“Reading grossed $276 million in 2019,” Edwards said, “so I really think they can afford to clean up this property” in Philadelphia.