Mixed-income apartment project in Center City receives final approval after nearly 11 years of planning.
A long-awaited apartment development at 2012 Chestnut Street in Philadelphia is on the verge of commencing construction, following numerous delays attributed to federal approvals and financial negotiations. The project is a collaboration between the Philadelphia Housing Authority (PHA) and Alterra Property Group. Initially expected to break ground in late 2025, construction has faced setbacks stretching into early 2026. However, PHA officials recently assured that construction will indeed begin within weeks.
During a board meeting, Kelvin Jeremiah, the president and CEO of PHA, confirmed that all necessary regulatory approvals have been obtained. He indicated that mobilization and construction are set to commence by October 6. The building will consist of 121 residential units, including 30 two-bedroom apartments, 63 one-bedroom apartments, and 28 studio apartments. Additionally, the development will offer 2,000 square feet designated for commercial use and off-site parking. Notably, this project will represent PHA’s only housing initiative in Center City.
According to preliminary plans, 40% of the rental units will be allocated for market-rate tenants, with the remainder priced for individuals earning 80% of Philadelphia’s area median income, which is approximately ,500 for a two-person household. The architectural design has been entrusted to JKRP Architects, while Hunter Roberts Construction Group will serve as the general contractor.
This development is set to replace a vacant lot that once housed the PHA’s former Center City headquarters, abandoned 18 years ago. The initiative has been in the works for a decade, since PHA first partnered with Alterra in 2016. However, the project has encountered significant hurdles, notably in its efforts to secure timely permissions from the U.S. Department of Housing and Urban Development (HUD), which has experienced considerable staffing reductions in recent years.
The ongoing delays have not only affected timelines but also project costs. Rising prices for materials, including steel and construction equipment, have increased the overall expenditure by million, bringing the total cost to million. These financial strains, combined with tariff uncertainties, present challenges for developers like Alterra, which will build and manage the mixed-income complex under a 99-year ground lease held by PHA.
As stakeholders prepare for the upcoming construction phase, the PHA remains committed to addressing affordable housing needs within the city, pursuing this ambitious project despite the complexities and obstacles that have arisen along the way.
