Businesses Have Room To Grow At The Navy Yard

As Philadelphia’s Navy Yard looks ahead to its next phase as a mixed-use community with residential properties, current and future business residents will be more than just along for the ride. Hear about all the opportunities at Bisnow’s Future of the Navy Yard event Sept. 7 at 1200 Intrepid Ave.

The Navy Yard has proven to be a dynamic spot for corporate headquarters of all stripes, with businesses as different as baking giants Tastykake, pharmaceutical companies like GSK, and apparel retailer Urban Outfitters all calling the yard home. The bounty of available space allows for companies of all sizes to find space they need, in the shape they prefer.

“A great deal of our lease transactions have been build-to-suits,” says Liberty Property Trust’s Tony Ewing, “so they’re leased before anything is built and we work with tenants on building, sourcing and developing.”

The opportunity to work with a blank canvas for a corporate HQ in a major city is a special one, as tenants like motorcycle retail and marketing company RevZilla have come to appreciate.

“With the support of Liberty Property Trust, we have been able to make our building live and breathe our unique culture,” says RevZilla CFO David Price. “It has helped fuel our growth through the ability to reinvest in the city and our employees through tax advantages.

“Most importantly, though, it has been a tremendous recruiting mechanism, as employees who come to the Navy Yard for interviews are immediately captivated at the convenience, polish and buzz that exist here.”

The fact that virtually all of the Navy Yard’s most recent wave of construction looks cutting edge is no accident—the "shiny new toy" feel is a key element in convincing businesses to move away from a more central location in Philadelphia or other cities to a business campus on the edge of town. The Yard doesn’t compete with other locations on the same terms; instead it has to highlight what sets it apart: the future.

Since RevZilla moved to the Navy Yard, it has quadrupled its employee count and consolidated its office and production spaces into an integrated workspace. Moving to the Navy Yard didn’t just give the company room to grow, it gave it a platform from which it could legitimately improve its business model.

The Yard is also designated as a Keystone Opportunity Zone, meaning businesses that move there get tax breaks that soften the impact of a major move. It may be as attractive as any single factor in drawing businesses. One thing that could supplant it would be better transit options.

“One of the biggest disadvantages of the Navy Yard is [the lack of] public transportation options,” David says. Although significant progress has been made in the last few years with the Navy Yard shuttle, having access to efficient, reliable public transit systems seems to be one of the last major milestones for the Navy Yard.

“Quite simply, a one-plus hour public transit commute from New Jersey and the PA suburbs with two trains and a bus is unrealistic to attract quality talent," David says. "Overcoming this hurdle will greatly up the attractiveness of the Navy Yard from an employee standpoint.”

An extension of the Broad Street Line is years away at best, and the bus is looked down upon, but one thing can circumvent the need for mass transit: just have your employees live at the Yard.

Residential options are coming in the next couple of years, and with the list of amenities only growing, Liberty and PIDC are betting big that they can create a community that makes people want to live where they work.

“My wife and I joke that the day there is housing at the Navy Yard is the day we move over from New Jersey to Philadelphia,” David says. “With such a calm, serene community, with easy access to highways and airports, beautiful parks and waterfront access, I can imagine most families would think of the Navy Yard as a wonderful place to live and raise a family.”

When people think about raising a family, they think about things that are built to last. The Navy Yard won’t look futuristic forever, but its buildings are all LEED certified to minimize their carbon footprint and maximize their longevity. Building all of them according to one master plan allows for the whole Yard to work as a somewhat self-contained energy network.

“Legitimately, part of it is self-preservation,” Tony says. “If we can operate a corporate campus on a private micro-grid that can master the distribution cycle such that it reduces energy waste, we save money on our power bill and we can deliver power more efficiently, which in turn saves more money.”

Along with the substantive benefits of a sustainable workplace, businesses also benefit from the optics of a green headquarters, which will only be more important as time goes on. No matter how a company thinks about the future, there is some benefit the Navy Yard provides.