When the ribbon was cut on Germantown’s iconic Rowell’s department store at the corner of Germantown and Chelten avenues last week, civic leaders were marking more than a grand opening for two new near-market-rate loft apartment buildings with a total of 94 one, two and three bedroom units. 

They were celebrating an important symbol of change in the heart of the neighborhood’s central business district.

Rowell’s, now called Vernon Lofts, includes 47 new units, as does Kenyon Lofts, which was built from the ground up on what had been a parking lot around the corner, at 40 E. Armat St. Rents range from $1,300 to $1,900 per month, and amenities include a gym, a lounge, a roof deck, a work-from-home flex space and a large bicycle parking room. Both buildings are a short walk to SEPTA’s Germantown regional rail station. 

Taken together, they represent a $25 million investment in the neighborhood. 

“Part of the reason we chose to redevelop the Rowell building is that the train is just a block away. You get on that train and you head right into Center City,” said Philip Balderston, founder and CEO of Odin Properties, noting that the Germantown station is surrounded by vacant land. “You will see more development around these stations as time progresses.”

A changing neighborhood

These may seem like brave words for those who, for generations, have watched the neighborhood’s descent into deep economic decline. According to Face to Face, a social service agency based in Germantown, the community’s poverty rate is now 50% higher than the rest of Philadelphia, which already ranks as the nation’s poorest large city.

But according to Emaleigh Doleigh, executive director of the Germantown United Community Development Corporation, that appears to be changing. These two new lofts are just the latest in a recent series of residential developments that have brought 1,500 new units of essentially market-rate housing to the neighborhood. And investors continue to come knocking, seeing real value in Germantown’s current market valuation, large tracts of open land and access to two regional rail lines.

“The reality is, there is a housing shortage in Philadelphia, and these units are going to get rented,” Doleigh said. And as these new residents spend their median income salaries on local businesses, she said, the impact will be “transformative.”

Balderston, who began his career working for Tower Investments – the same company that redeveloped the Schmidt’s Brewery site in Northern Liberties – said he sees a similarity between where Germantown is now and where Northern Liberties was in 2001 when the company purchased the Schmidt’s site. The site was named The Piazza at Schmidt’s, later shortened to The Piazza.

“The high-rise and mid-rise buildings you see there now, 22 years later, are finishing up the process that began then,” he said. 

Ken Weinstein, a Mt. Airy-based developer who has invested heavily in Germantown and is now revitalizing Wayne Junction, said the new living units will not only revitalize the neighborhood, they will also help bring down housing costs. 

“More people and more density bring more vitality to the corridor, which will encourage more small businesses to open, which is ultimately what Germantown needs,” he said. “The bottom line is that we need more of exactly what this developer just did.”

Both Doleigh and Balderston say the shift won’t be fast, but incremental. Much of the poverty in Germantown is entrenched and generational. Long stretches of its main retail corridor – including one long stretch of Germantown Avenue next to the Rowell Building – remain stubbornly vacant, despite years of effort by activists who seek change. And while redevelopment has finally begun on part of the massive Germantown High School campus, no such change appears to be coming soon for two other local landmarks, the Germantown YWCA and the old Germantown Hall.

Balderston, who grew up in Center City and attended William Penn Charter in East Falls, said he began investing in the Northwest about 10 years ago, starting with the renovation of two apartment complexes, Duval Arms and Magnolia Court. 

“I’m familiar with the neighborhood - in fact, I used to drive by the Rowell building in particular and wonder about it, because it was so prominent sitting right there on that corner,” he said. 

Next, he’s planning another adaptive reuse project near La Salle University, at 5115 Belfield Avenue. 

“We’re working on approvals for that now,” he said. 

History

The building, which is now the second tallest in Germantown, was first designed by Germantown architect Arthur Brockie in 1889 for the fledgling Germantown Trust Company. The bank added the 8-story office tower in 1929, and in 1950 Clarence A. Rowell bought it for his department store. 

At the time, Germantown was Philadelphia’s second-largest commercial district after Center City. Its retail corridor included Woolworth’s, Cherry’s, Allen’s and S.S. Kresge’s as well as busy restaurants, movie houses and theaters. 

Then came the rise of the suburban shopping mall, and Rowell's was sold to a Chicago department store conglomerate in 1963. Curtis W. Sisco purchased it in 1974, becoming the nation’s first Black department store owner. It was the last independent department store in the commercial district until it closed in 1976.

In 2020, the Rowell Building was added to the Philadelphia Register of Historic Places.