A roomful of elected officials and community leaders gathered for lunch Monday at Port San Antonio to hear about transformation. The story they heard was a familiar one.
For generations, the military facility had played a central role in the nation’s security and in projecting American power and reach abroad. Thousands, sometimes tens of thousands of civilian workers were employed there in any given year, their federal wages carrying countless working class families into the growing middle class.
By the 1990s, however, the Base Realignment and Closure Commission had targeted the facility for closure. As 2000 and a new century arrived, city leaders suddenly faced the enormous challenge of redeveloping a shuttered military facility.
The story is a familiar one in San Antonio, where Kelly Air Force base helped define 20th century San Antonio, yet closed in 2001, a decade after the start of its decline as a major air logistics command.
Tuesday’s lunch, however, wasn’t about Kelly or Port San Antonio. The topic at hand was the remarkable transformation of the Philadelphia Naval Shipyard into what is known today simply as The Navy Yard. It is considered one of the most successful military base conversations in contemporary times.
The Navy Yard today is home to 130 businesses that employ more than 11,000 workers on the 1,200 acre campus located on the Delaware River in South Philadelphia, not far from the South Philadelphia Sports Complex, home to the Eagles, Phillies, 76ers and Flyers. Employers are adding nearly 1,000 jobs a year, and unlike Port San Antonio, where 13,000 people are employed in aerospace and light industrial work, The Navy Yard is home to corporate offices and dot-coms as well as light industrial and manufacturing.
To see a complete list of The Navy Yard tenants, click here.
The Navy Yard is known for its commitment to sustainability, evident in its buildings, energy profile and the growing network of parks and public spaces that enhance the campus and belie the property’s former existence as a ship-building yard.
Williams J. Agate, Jr. the senior vice president and ranking executive at The Navy Yard, was invited to Port San Antonio by Bruce Miller, the soon-to-retire CEO of Port San Antonio, whose 12-year term has taken the former Kelly AFB from the early stages of redevelopment to its current status as one of the state’s major aerospace centers and inland free ports. Former Port San Antonio Board President Wayne Alexander is leading the national search for his successor.
Agate and Miller, the two specialists in base redevelopment, are more friends than competitors.
“All of us are in the same business of making America more competitive in the global marketplace,” Agate told the audience. “This is no longer about Philadelphia competing against San Antonio, or San Antonio competing against some other U.S. city. We’re getting away from all that.”
Bringing Agate to San Antonio, Miller told the gathering, is part of larger conversation now underway of how to take Port San Antonio to the next level. Miller recently announced his planned retirement. You can read more about his tenure at Port San Antonio in this recently published Rivard Report interview.
Mayor Julián Castro named a blue ribbon task force last year to study the challenge as sequestration and federal cutbacks threatened workloads at the Port. Tenants like Boeing were seeking reduced rents to offset declining workloads while aerospace companies sought to make the transition to more commercial work. Port San Antonio officials, who finance operations with leasing revenues, reached out to local officials to explore new revenue sources to accelerate redevelopment efforts.
A final report was submitted to Castro in December, but its findings have not been released and the Mayor has not spoken publicly about any new ideas to finance Port San Antonio growth. Some wonder if the political will and financial resources exist at the city and county levels to do more to support the base redevelopment efforts. The state has never contributed to base redevelopment.
Philadelphia and The Navy Yard are remarkable for both their similarities and differences with San Antonio and Port San Antonio. Philadelphia, with a population of 1.5 million people, is the nation’s fifth largest city, while San Antonio, with a population of 1.3 million people, is the seventh largest, although the City of Brotherly Love is the sixth largest MSA, substantially larger than the Alamo City, the 25th largest MSA.
Both cities lost similarly sized major military facilities, fighting unsuccessfully for their preservation throughout the 1990s and, as the new century approached, beginning the painful process of accepting closure and starting redevelopment efforts. If San Antonio regarded Kelly’s closure as a major economic, cultural and historic blow, it was worse in Philadelphia, which fought closure all the way to the U.S. Supreme Court. The original shipyard was the country’s oldest, dating back to 1776 and the founding of the nation.
Where the two stories diverge, however, is their approach to redevelopment. Port San Antonio has received bond monies from the City of San Antonio for infrastructure improvements, but has had to self-finance its operations and continuing redevelopment. At times it seems the larger city has forgotten about Kelly and the huge challenges of redeveloping the former military base.
“From the very start, we positioned The Navy Yard as part of Philadelphia, not something separate and off to the side,” Agate said. “Our approach is that we were creating jobs for the entire city. Our mission is to implement economic development initiatives which retain and generate jobs throughout Philadelphia.”
Direct infrastructure investment in The navy Yard to date includes $130 million in public funds and $700 million in private investment, Agate said. Officials are on pace to see 20,000 workers at The Navy Yard by 2020. The 114 companies now occupy seven million sq. ft. of office and industrial space. The U.S. Navy retains control of 200 acres of the former shipyard, but is not a major presence.
“All of the money spent on the parks has been public funds,” Agate said when asked about beautification efforts and the campus’ 18-plus acres of attractive parks. “But it’s been public money where we’ve been able to say, ‘If we spend this money we will attract an even larger investment in the form of private development.’ ”
The Philadelphia Economic Development Corporation hired Robert A. M. Stern Architects in New York, which produced a comprehensive master plan in 2004 that was updated last year. At its core was a commitment to sustainability, LEED-rated design and construction, and campus beautification that made the former shipyard appealing to businesses willing to locate white-collar offices there. Today, The Navy Yard is home to a major corporate office of GlaxoSmithKline, the world ‘s fourth largest pharmaceutical company, and Urban Outfitters, a clothing company that appeals to style-conscious teenaged girls and young women.
“We’ve got some work ahead of us, don’t we?” one of the business executives seated at my luncheon table remarked after viewing Agate’s slide presentation that displayed the sleek, energy-efficient office buildings and imaginative public pocket parks that dot the Philadelphia campus.
A number of elected officials, including state Rep. Jose Melendez, City Councilmen Rey Saldaña and Ron Nirenberg attended the presentation, and representatives of the Mayor and other council members also were there. Red McCombs was the most prominent business leader to attend, along with aerospace executives and military commanders from nearby Lackland AFB, who oversee growing cyber-security command operations there and management of the runway shared with Port San Antonio.
After lunch, I drove the 1.7-mile length length of the Port’s newly constructed 36th Street, which now runs inside the Port from Highway 90 to Billy Mitchell Boulevard, and eventually will be extended to Gen. Hudnell Drive.
The four-lane, landscaped thoroughfare opened up 400 additional acres of the former Kelly Air Field for development.
The new roadway offers a glimpse of the future transformation of the Port, whose 1,900 acres are only 40% developed and have the capacity to support 25-30,000 people once fully redeveloped.
“Someday we want to see 36th Street extended all the way to I-35,” developer Marty Wender commented at the luncheon.
“And when that happens we want to rename it for Sen. Frank Madla,” Rep. Melendez quickly added without missing a beat.
Follow Robert Rivard on Twitter @rivardreport or on Facebook.
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