As Center City arena dies, Sixers, Comcast, and City Hall say they will still revive Market East

The 76ers’ stunning reversal on their plans for a Center City basketball arena is another blow for East Market Street, one of downtown Philadelphia’s most beleaguered commercial corridors.

Just three days before the 76ers news leaked, Mayor Cherelle L. Parker’s administration touted the arena as an “anchor” for East Market Street that would incentivize new development even before it was built. The basketball team’s owners have long pitched their plan as a much-needed boost for the corridor.

Now, with the 76ers teaming up with Comcast Spectacor and staying in South Philadelphia, City Hall officials, the team, and Comcast sought to assuage concerns that the sports complex’s gain would be Center City’s loss.

“Market East, which was once an essential business hub for the city, needs a better future,” said David Adelman, a Sixers co-owner who led the charge on the Center City arena. “While our arena will be built in South Philadelphia, the Sixers and Comcast are now partnering and fully committed to revitalizing the once-great Market East corridor.”

The Sixers retain options on an array of properties on the south side of Market Street, which they initially proposed to redevelop as residential and retail projects in tandem with the arena. What such an effort looks like now is unclear, and no details were offered.

Retail vacancy is rife along East Market Street, and many of its office buildings have not seen their occupancy rebound after COVID-19. The urban mall known as the Fashion District (formerly the Gallery) reopened just before the pandemic and has continued to struggle. The Wanamaker Building next to City Hall is losing Macy’s, its anchor tenant and the last remaining department store on East Market Street.

Parker has made the revitalization of the commercial corridor a top priority and said her administration will now prioritize a master plan for the area.

“We talked about a revival of Market Street that would occur from City Hall down to the river,” Parker said Monday. “Nothing about that commitment has changed, except we will now fast-track the master plan and begin that process immediately.”

Parker also noted that while Pennsylvania Gov. Josh Shapiro had said he would not provide subsidies for a basketball arena on East Market Street, she has approached him about state aid for broader revitalization efforts in the vicinity.

A city spokesperson said the governor has made no commitments yet. A spokesperson for Shapiro told The Inquirer that he would need to see concrete plans before deciding whether to commit state resources to East Market Street.

“Gov. Shapiro was very clear and affirming to us,” Parker said. “We had already laid the foundation. … We knew the ask could not be for an investment in the arena directly because the governor had been absolutely clear about that.”

A news release issued Monday announced that Harris Blitzer Sports & Entertainment (HBSE) and Comcast Spectacor had “entered into a binding agreement” to jointly build a new arena in the South Philadelphia sports complex and something in Center City.

“In addition, the partnership will include a 50-50 venture to invest in the revitalization of Market East in Center City,” the news release said.

But the details about what precisely might be coming to Market East were scarce.

“HBSE and Comcast will also immediately focus on Market East, bringing together government officials and local stakeholders to develop a variety of options to revitalize a vital neighborhood in Center City where the 76ers had originally proposed locating the arena,” the release read.

City Hall officials hope that if the new partnership is truly invested in East Market Street, the arena’s cancellation could be good news, essentially doubling the number of mega projects — especially if it means the telecommunications giant now has a stake in the corridor’s revival. Last year the company pitched a biomedical hub as a replacement for part of the underperforming Fashion District.

At the news conference, Comcast CEO Brian Roberts kept his company’s commitment to East Market vague. He did note that during a recent visit the area was looking peaked.

“The neighborhood needs a vibrancy, and the Sixers have been right about that,” Roberts said. “So that’s another project, and that’s going to require thought and starting over, but we’re committed to that.”

Late last year, as the Center City arena gained political momentum, Harris Blitzer Sports & Entertainment assembled several existing commercial properties on the 900 and 1000 blocks of Market Street.

About 28,000 square feet of retail space was envisioned for the 1000 block along with 380 apartments, with a launch date of 2027. A second phase of development for the 900 block would have included 340 apartments, 26,000 square feet of retail, and 114 parking spaces.

Mayor Parker also revealed early plans from the Philadelphia-based Goldenberg Group to transform the parcel at Eighth and Market, known as “the Disney Hole” due to a long-ago unrealized mega development project, from a parking lot into a 400- to 600-bed hotel with 45,000 square feet of retail.

The status of all those plans is now unclear, although Parker said she would succeed where the previous three mayors had failed and get rid of the vast surface parking lot at Eighth and Market Streets.

Turning to Council President Kenyatta Johnson, Parker said at the Monday news conference, “I’m committed before you and I leave here … to fill that Disney Hole.” She pitched reviving the long-underutilized space as key to “bring life back to Philadelphia’s first historic commercial corridor.”

The Goldenberg Group did not respond to a request for comment.

As for the properties Harris Blitzer Sports & Entertainment retains options on, a mix of residential and commercial uses is still likely. Parker also has hopes of attracting the Women’s National Basketball Association (WNBA) to Philadelphia, and there has been talk of a 5,500 or more seat concert venue previously considered for the sports complex, which could potentially fill a gap on East Market.

City Council members say the fate of the Fashion District shows that more innovative thinking is needed.

“If we are trying to be innovative and attract people downtown, we want traditional retail, but a new project won’t be sustainable on that alone,” Councilmember Isaiah Thomas said. “We need to push lifestyle and experiential retail, not just traditional shopping centers with condos on top.”