An Urban Makeover

Philadelphia regenerates itself small bits at a time. Sometimes, however, bits accumulate in close-enough proximity that an entire neighborhood is transformed.

Case in point: It's midmorning on a late winter's day at 13th and Fitzwater Streets, at the edge of a city neighborhood known as Hawthorne.

To the west, workers scurry about a muddy expanse behind the glass-steel-and-brick, $70 million high-end apartment block called 777 South Broad, which developer Carl Dranoff is about to open.

To the east, behind a chain-link fence, heavy-equipment operators shift tons of earth for a $7.4 million complex of 19 three-story townhouses that will be for sale after their expected October completion.

These are just two of the new and rehab projects revitalizing Hawthorne and creating what appears to be a seamless, reinvigorated swath from the river edge of Queen Village through Bella Vista, to Southwest Center City across Broad Street.

"Hawthorne is probably the fastest-growing area of Center City that no one has ever heard of," said Prudential Fox & Roach associate broker Mark Wade.

He sells real estate there - including 53 condos carved out of the old Nathaniel Hawthorne School and now headed for the market.

"Twenty years ago . . . development, value, and general inquiries from the home-buying public stopped at 11th Street," Wade said. Today, "the area between 11th and Broad has become one of the new targets for those looking to remain close to Center City, without the Center City prices."

The price range - generally $200,000 to $350,000 - is the sweet spot of the current market, made even sweeter by income-tax credits, low interest rates, and the 10-year property-tax abatement for new and rehabilitated units.

The neighborhood has proved to be a draw for young singles and families with small children (with the accompanying proliferation of day-care centers), as well as for-profit developers big and small.

Hawthorne - specifically the 1300 block of Fitzwater Street - was, until Oct. 17, 1999, the home of four towers that made up the Martin Luther King Plaza public-housing project.

On that October Sunday, 756 pounds of dynamite took down the 39-year-old high-rises first collectively known as Hawthorne Square.

In the decade since, an $80 million public-private partnership has replaced the towers' 550 units with 245 for-sale or rental units built in the vacated space or on nearby blocks.

The 19 three-story townhouses, under construction where the Hawthorne Community Center once stood, will round out the project.

Prime movers in the neighborhood include the Philadelphia Housing Authority (PHA), under executive director Carl R. Greene since 1998; the nonprofit Universal Community Homes, headed by record producer Kenny Gamble, who began rebuilding efforts there long before the towers were demolished; affordable-housing builder Pennrose Properties, which partnered with Gamble, and the city itself.

The catalyst was HUD's Hope VI program, launched in 1992 to transform public housing and revitalize neighborhoods.

"It was a federal initiative, but Carl ran with it," said PHA spokesman Kirk Dorn. "He realized that the only way to bring about change was to do it on a big scale, a full-fledged job instead of just 15 houses."

Planned for 12th and Catharine Streets is a park, roughly the size of half a city block, with shade trees, paths, benches, and a lawn.

Creating new and affordable public-housing opportunities - with amenities like energy-efficient appliances that are readily available to market-rate home buyers - has made the difference.

"Center City expansion was blocked for years by poorly designed housing projects in Hawthorne and Southwark, as well as Richard Allen Homes north of Vine," said Paul R. Levy, president of the Center City District. "The PHA created a quality product and proved that economic integration can work."

City tax data show PHA housing in the 700 block of South Juniper Street selling for $209,000 to $335,000, while for-profit developers are selling $700,000 townhouses in the next block.

As a result, Levy said, "a lot of [for-profit] developers began filling in the gaps, not only in Hawthorne but in Bella Vista and Queen Village."

One of them was David Grasso, whose Grasso Holdings developed the Lofts at Bella Vista building at 11th Street and Washington Avenue.

"I am not certain I would have had the vision to develop the Lofts if all the demolition had not been done, and if I hadn't seen those homes going up a few blocks away," he said.

"I love that building and the neighborhood," said Grasso, who lives nearby. Lofts at Bella Vista has 78 condos priced from $300,000 to $1.5 million.

For developer Anthony Rufo, Hawthorne had a personal connection: His father grew up in the 700 block of Marvine Street and went to Nathaniel Hawthorne School.

Rufo began neighborhood-revitalization efforts with civic groups and churches long before the King towers were imploded, building infill townhouses and rehabbing single-family rowhouses.

Three years ago, at 12th and Fitzwater, Rufo transformed the old Acme Auto Parts store and warehouse into the Lofts at Fitzwater, 16 condos that sold from $175,000 to the high- $300,000s.

"The city was pointed in the right direction," Rufo said. "It has given me the enthusiasm to do more."

Today, he is turning the neighborhood school into the 53 condos Wade will soon market at prices from the high-$100,000s to $300,000.

Jeffrey and Beth Ann Forman were first to buy one of Rufo's 14 townhouses near 11th and Fitzwater 21/2 years ago. They paid $620,000, property records show.

"We had a condo at 10th and Spruce but were looking for a single," Jeffrey Forman said. He'd looked in other places, but was "pleasantly surprised" by what he saw in Hawthorne.

"We walk everywhere, even to work in Center City," he said, adding that the neigborhood was filling with young people with children.

Dranoff's 777 South Broad occupies the former site of 10 derelict rowhouses and the old Broad Street Hospital, which closed in 1988.

After Gamble's Universal Cos. could not obtain financing to develop retail and office space there, Dranoff became the lead partner in the development, changing it to a five-story building with 146 apartment units, after negotiating with the Hawthorne Empowerment Coalition, a neighborhood group.

Razing the Martin Luther King towers "lifted a 400-pound weight from an entire region of the city," Dranoff said. "The result has been a transformation that no one really had anticipated."