Ask John Westrum, owner of the Westrum Development Co., about how his company became one of Brewerytown's primary investors, and he'll likely tell you about the day he surveyed the struggling North Philadelphia neighborhood while standing atop the Red Bell Brewery building on 31st Street.

It was then, he said, that he saw the wealth of potential for the future of the community.

Within a few years, Westrum had purchased the former brewery building at 31st and Jefferson streets along with a number of other Brewerytown properties.

His intent was to transform the dilapidated buildings, and with them one of Philadelphia's poorest neighborhoods.

But, with the recent sale of the nearby Pyramid building at 31st and Oxford streets and the impending sale of Westrum's one-time perch, the Red Bell building - both to the Philadelphia-based Iron Stone Real Estate Co. - some worry Westrum's far-reaching plan might be faltering.

Contacted Monday, Sept. 28, the longtime real estate developer said he fully intends to pursue his initial plans, but noted that the shaky footing of the national housing market has caused some of his plans to change.

"The housing market has gone through turmoil in recent years," he said. "The market is very challenging."

When Westrum set the wheels in motion to begin his projects back in late 2006, the developer secured the help of City Councilman Darrell Clarke (D-5th dist.) in order to create what became known as an "Industrial Transformation District" (ITD) in Brewerytown.

In creating the Brewerytown ITD, Clarke provided Westrum with the means to simplify zoning procedures by delivering a master plan that covered some 16 acres of land.

The plan was approved by the Planning Commission and City Council in early 2007 and covered 11 buildings and plots within the area bounded by Girard and Oxford avenues, to Fairmount Park and 31st Street.

In this condensed area, Westrum proposed the construction of 533 residential units; only Brewerytown Square, with 144 units, has been completed.

While Westrum said the struggling housing market has hampered his efforts, the Brewerytown Square town home complex, located as 31st and Master Streets, is currently fully occupied.

He plans to begin construction of the next phase of his project - the 114-town home Quaker Square development, located just north of Brewerytown Square - sometime in early 2010.

The Flats at Brewerytown, a multistory condominium complex that will be located near the intersection of 31st and Stiles streets, is also in the works, but will not be constructed until the completion of the Quaker Square project.

Westrum said construction of those projects currently is on a "temporary hold, based upon market conditions."

When asked if Westrum's sale of the Pyramid building and impending sale of the Red Bell building might stifle Westrum's proposed plans for the neighborhood, Councilman Clarke said no.

Clarke said he believes Westrum is doing the most he can in the floundering housing market and as long as the sale of those buildings brings benefits to the community, he supports the sale.

"No, it wouldn't (change my opinion)," he replied. "The initial proposal was to create houses in those two buildings, but the market determined that's not feasible. The likelihood is that this (sale) will create jobs, and I want that to happen."

James Carter, president of the Brewerytown Community Development Corporation, similarly supported the sale, saying that from the community's perspective, the most important aspect of Westrum's plan might be the proposal to create a 35,000-square-foot supermarket complex at the intersection of 31st Street and Girard Avenue.

"I'm not concerned. They are going to continue to develop in the neighborhood," said Carter of the sale. "I think if conditions were normal all of this would be done. I think his biggest problem might be that he doesn't know if he could sell everything, and I think everybody understands that. But, the neighborhood is hoping that he will still be able to handle that supermarket project."

Westrum noted that he was still hard at work at securing an operator for that supermarket project, but finalizing anything is proving tricky.

The land itself is hard to develop - a triangular, 2.8-acre tract - and without public funding to help develop the area into a workable site, Westrum fears that getting a supermarket operator to agree to build on that site might be extremely difficult.

The site is so difficult to develop that, for much of last year, the Community Design Collaborative, a Philadelphia volunteer community design center, held a contest to allow an urban design group to experiment with ideas for the site.

While the contest produced some interesting design ideas, it seemingly did little to help make the supermarket a reality.

The primary problem remains getting retail chains to invest in a problematic site located in a neighborhood where few chains are interested in operating.

Because of those challenges, Westrum believes it may not be financially viable to make the site suitable for a supermarket.

"I have two operators I'm working with right now for that site," he said. "But, nothing is final until it's final. Clearly the community wants it, clearly, the city wants it and clearly, the state wants it, but we have a large, multi-million dollar gap in economic viability and, right now, public funding, a necessary source of financing, is hard to come by. If this was easy to do, it would be done already."

He said the problem boils down to the reality of the supermarket's potential financial performance versus the high costs of construction.

"There's a five-to-ten million-dollar gap (on the supermarket project,)" he said.

But, he hasn't given up on the supermarket plan and said he fully intends to continue working toward that end.

"We're going to pursue the supermarket avenue until it's dead," he promised.

As for the rest of the projects proposed in Westrum's master plan, he said he still believes in his initial vision for Brewerytown and he is fully invested in developing the neighborhood.

He said that, luckily, the housing is now a "buyer's market" and he sees the housing market mounting a comeback in the months to come.

"The pricing of units has been adjusted and now is a great time to buy," he said.

Reporter Hayden Mitman can be reached at 215-354-3124 or hmitman@phillynews.com