A Mixed-Income Housing Proposal Lays Bare Frustrations With The Philly Land Bank Board

Perhaps no source of potential affordable housing in Philly carries as much hope and causes as much consternation as the Philadelphia Land Bank, a paradox that played out at its most recent meetings earlier this week and last month.

At its Sept. 12 and Oct. 10 meetings, the PLB board heard a proposal to sell 75 city-owned lots scattered across the Norris Square neighborhood to a subsidiary of developer Riverwards Group for $75K under the city's Turn The Key program. The two meetings were flooded with public participants, the vast majority of whom voiced their opposition to the project.

But PLB's board lost the six-member quorum it needed to hold votes during the September meeting after three members left partway through, according to PLB's official meeting minutes. 

The proposal was pushed to the October meeting, but after repeated poor board attendance, more community opposition and a plea in favor of the proposal from a local sanitation worker in the American Federation of State, County and Municipal Employees District Council 33, the board ruled to require Riverwards Group to come back a third time.

The outcome of the two meetings has given Riverwards Group Managing Partner Mo Rushdy and Nilda Pimentel-Perez, chair of local registered community organization Norris Square Community Action Network, something to agree on: Both said they felt disrespected by PLB's delays and both sides alleged to Bisnow that the board is showing unfair favor toward the other.

“Yesterday, we saw how some board members hesitated when voting,” Pimentel-Perez said. “They were looking for a way to keep this project alive, to sacrifice our community again.”

The proposal, submitted under the entity BMK Properties, meets the qualifications of the Turn The Key program, PLB Executive Director Angel Rodriguez said on the Zoom call for the October meeting. To Rushdy, that should be the only consideration for the board, along with whether a developer has financial backing, though Rodriguez said the board is allowed to evaluate projects however it sees fit.

Riverwards Group submitted proof of a $25M term sheet from Meridian Bank. 

“I am beyond frustrated,” Rushdy said in a phone interview with Bisnow minutes after the October meeting adjourned. “Because I am a large advocate for the Turn The Key program, and we're telling people about it every day to go and apply.”

Although it is administrated and staffed by employees of Philadelphia Housing Development Corp., the Land Bank has an independent 11-seat board appointed by the mayor and city council that must approve or reject any proposed disposition of property worth at least $50K with six votes.

With one seat on the board open since January, only seven of the remaining 10 members attended Tuesday's meeting, which started 50 minutes late as it waited for board members to log on.

District 7 Councilmember Quetcy Lozada sent a letter to PLB's board ahead of the session to say she couldn't support the project, meaning she would be unlikely to introduce the city council resolution needed to dispose of the land even if PLB gives its approval.

After a motion to approve the Norris Square proposal failed to garner the six needed votes, the seven members voted to compel Rushdy to meet once more with community members, PLB staff and Lozada.

That makes the project unlikely to be resubmitted for PLB board approval until December at the earliest, Rushdy told Bisnow.

The proposal called for 38 houses designated at three tiers of affordability and 37 market-rate houses, satisfying Turn The Key's mandate of 51% affordability. Of the 38 affordable houses, eight would be restricted to and priced for households making 60% of Philadelphia's area median income, 13 would be for 80% AMI and 17 would be for 100% AMI.

Two registered community organizations in the area, the Norris Square Community Action Network and the Norris Square Community Alliance, both expressed vehement opposition to the project on the grounds that the market-rate housing component would be too large and the majority of affordable units would still be unattainable to local residents.

Two key parts of the Turn The Key initiative are the soft, forgivable second mortgage it offers to help make homeownership achievable and the priority it gives to municipal workers, who are mandated by local law to live within Philly city limits. Considering where interest rates are now and the median income of Norris Square residents, for-sale homes of any kind don't meet local need, Pimentel-Perez said.

“The central issue for us is the number of units [Rushdy] offered that are truly affordable,” Pimentel-Perez said. “We know the dynamics of the market, and we feel that a homeownership project at this moment is not a good deal for the neighborhood when the need is to create multifamily housing that is affordable. There are some lots more suitable for houses in this proposal, but many of them are appropriate for affordable rentals.”

Other cultural organizations in the area, which is heavily Latino, specifically Puerto Rican, expressed gentrification concerns, while still other opponents were local residents who had been using the vacant lots for parking or open space and sought to purchase them for such uses.

Several nearby homeowners claimed they hadn't been notified of the required community engagement meetings held by Riverwards Group and the Norris Square RCOs, though Rodriguez said that all requirements had been met.

“I’m laughing because I gave [the RCOs] five proposals to pick from, and anything ‘better’ wouldn’t pencil out,” Rushdy said. “But OK, I’ll follow the rules, meet with Quetcy, have another RCO meeting, record it and go back to the Land Bank.”

The Zoom sessions Rushdy held weren't accessible for older, nonnative English speakers in the neighborhood, part of the reason they were sparsely attended, Perez-Pimentel said. But even with better communication, she said she doesn't see the neighbors' position changing unless the unit mix changes to include a higher percentage of deeply affordable homes.

To Rushdy, it is another example of nothing being good enough for Philadelphians who weigh in at public meetings. The Land Bank is well behind on its target for land dispositions set when Turn The Key was passed.

“If you’re behind by 10,000 [affordable] units, your priority should be whatever gives you scale,” Rushdy said. “If the devil gives you scale, you go with the devil. It’s as simple as it gets.”