Philadelphia Navy Yard Named Largest LEED Neighborhood Development Site In The U.S.
A Philadelphia neighborhood with a storied industrial history has been transformed into the city’s keystone sustainable real estate project, even though it is still hard to get there without a car.
The U.S. Green Building Council dubbed the Philadelphia Navy Yard the largest LEED-certified neighborhood development in the nation last month. Stakeholders celebrated the news with a press conference on Earth Day.
The goal is to create “a clean, green, safe environment for people to live and work,” Ensemble Real Estate Investments Managing Director Mark Seltzer told Bisnow of the former shipbuilding site.
Redevelopment officially began in 1999, but it entered a new stage in 2021 when Seltzer’s firm and Mosaic Development Partners inked a joint deal granting them exclusive rights to build on 109 acres in the complex.
The LEED designation encompasses about a quarter of the 1,200-acre complex in deep South Philadelphia, according to a press release. Twenty-two planned or existing structures on the site have some sort of LEED certification.
One of the main projects currently underway is Korman Communities’ AVE Navy Yard, a 614-unit apartment complex that will welcome the first residents to the neighborhood later this year. Developers are also working to bring retailers to that part of the Navy Yard.
“That’s really where we’re trying to create the core, the downtown,” said Mosaic co-founder Leslie Smallwood-Lewis. “That’s what’s been missing down here, that 24/7.”
The tenants will join roughly 16,500 workers from the 150 companies with a presence at the Navy Yard, Philadelphia Industrial Development Corp. Executive Vice President Kate McNamara said.
While it would theoretically be possible to live in the Navy Yard without a car, it might not always be convenient.
“It really depends on where you work,” McNamara said.
The complex is not serviced by the Southeastern Pennsylvania Transportation Authority during the work week. Instead, there’s a privately funded shuttle that brings commuters to either NRG Station on the Broad Street Line or Jefferson Station in Center City. On the weekends, the Navy Yard gets hourly SEPTA bus service.
Just 1,300 people use the Navy Yard’s bus system on a daily basis, McNamara said. That’s partly because many workers have night shifts, which makes it hard to line up their commutes with SEPTA’s service.
Still, some companies with a presence at the Navy Yard have an employee public transit ridership rate of as high as 40%, Seltzer said.
The reliance on cars could minimize the sustainability work underway at the Navy Yard.
Transportation accounted for 28% of all American greenhouse gas emissions in 2022, the Environmental Protection Agency reported. Light duty vehicles made up 57% of that metric.
Sustainability certificates from LEED and similar organizations have boosted the value of many new construction projects since the 1990s.
Last year, sustainable buildings were selling for between 20% and 25% more than their less sustainable peers, according to analyses from JLL and Green Street. A report from Knight Frank found that these buildings also lease up faster and fetch rents 10% higher than less sustainable rivals.
But environmental concerns were not front and center during the Navy Yard’s heyday as a ship construction site.
When it was decommissioned in 1996 and PIDC took control, the organization undertook extensive remediation work alongside the city and the U.S. Navy.
“You still occasionally will run into different contaminants,” McNamara said. “We test every site that’s developed.”
Still, the Navy Yard wasn’t completely defined by manufacturing, Seltzer said. The complex is roughly the same size as all of Center City, and the part where most new development has been concentrated was not historically used for industrial purposes.
Sustainability has “been our focus from the very beginning,” Smallwood-Lewis said of Mosaic and Eclipse’s work at the Navy Yard.
Their partnership at the site commenced just four years ago, but the political climate has changed drastically since then. Sustainability is now less of a priority for many CRE leaders.
“I don’t think anyone cares,” Keystone Development + Investment President Rich Gottlieb said of sustainability efforts at a Bisnow event shortly before Inauguration Day. “Corporations just don’t seem to be willing to pay for it.”
Smallwood-Lewis, Seltzer and McNamara haven’t seen that shift in their circles.
“I don’t really think there is a huge conflict,” McNamara said.
