Anyone seeing Kensington improving?

Question

It's been ~6 months since the mayor did the initial sweep. Still early but changes seem positive. Anyone looking into that area now or been in the area seeing a difference?

Stuart Udis · Answer

It still looks like a zombie apocalypse when you drive up Kensington Ave. Even if the area is cleaned up, I wouldn't purchase any rental real estate in Kensington, Fishtown or Northern Liberties for a few years. There's so much inventory that still must be absorbed it will be an uphill battle keeping your inventory occupied unless you are an A+++ location. The one product that will absorb well will be single family homes geared to the young families who are having trouble buying due to market condition and need more space. However,  they will want to be in the better situated areas of Fishtown or Northwern Liberties and are willing to pay $3,500+/m (many homes renting for $4,000+). That inventory is lacking and 3 bedroom homes are consistently being absorbed in less than 30 days without concessions. Meanwhile tons of concessions being handed out for smaller units to help lease up efforts.

Jonathan Greene · Answer

Kensington is the hardest NO for me of all-time. There are parts of every major city that will just never come up and this seems to be one of the most obvious in Philly. I don't live there, but I have investors all over Philly. I think Strawberry Mansion has so much better scale for still room to grow neighborhoods there.

Jonathan Greene · Answer

I personally wouldn't invest in the Mansion right now either, but I think it's location and proximity to better areas is a little better than Kensington, but I don't live there so I could be off on that. Kensington is one of those places that they will keep trying, but it's not coming full circle anytime soon. I like Fishtown.

Alan Asriants · Answer

Will agree with this, but will add that strawberry mansion is a no for me too. Not sure where I would even want to start investing there...

Olde Kensington is seeing improvement and even has some of the best local restaurants. I can see the area continue to improve, but as Eric said, north of Lehigh is a drastically different area. Unless there is drastic reform, I don't see there being much improvement in the short term or near future for the tougher parts of Kensington. Still wouldn't invest there because local inventory is far outpacing demand. There is too much competition with large scale construction projects who are offering crazy incentives. This is happening even in solid parts. Buildings are sitting vacant and offering free rent for even 2 months + to get people signed up. They need to fill vacancies just to get out of bridge debt so they would rather offer free rent, just to have a lease signed at X amount to get them into longer term financing. This is hurting the local landlord as they have to compete with those incentives. Happening in many areas like: kensington, NOLIB, fishtown, point breeze.

Stuart Udis · Answer

Strawberry Mansion has some ill advised zoning overlays that are really going to hurt the neighborhood's appreciation potential. It is one of the best examples of City Council and local registered community organizations huddling together to create restrictions intended to thwart development but here they are doing it in a manner which will leave new housing stock in the dust relative to other neighborhoods thanks to terrible design restrictions. It's unfortunate because the location of the neighborhood possesses some promising fundamentals that likely won't come to fruition for a very long time.

Sean Hourigan · Answer

Stuart - so you think the play is single family homes in "nicer" areas vs the typical multifamily geared toward childless singles?

single family homes in the city are a relative bargain right now, depending on school district...

Anyone seeing Kensington improving?

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