State College, PA - Centre County - Central Pennsylvania - Home of Penn State University

State College aims to balance new high-rises with old charm to remain an economic hub

by on September 29, 2017 10:40 AM

For the past several months, drivers entering downtown State College from the east have seen the jibs of construction cranes slowly pulling into shape the latest high-rise building.

Historically speaking, this type of development is mostly out of character for the quaint university downtown, but The Rise, a 12-story building at 532 East College Avenue, is but the latest in a trend that has not yet run its course.

The 12-story Metropolitan opened this year at College Avenue and Atherton Street. The 12-story Fraser Center came before that, as did other, albeit smaller, apartment buildings. Another 12-story, mixed-use building, The Residences at College and Atherton, is planned for the west end of College Avenue downtown. These buildings — behemoths relative to most of their neighbors — are here for the simple reason of supply and demand: beds for students.

The market dictates their existence, and if they weren’t built downtown, those beds would likely be put in the sprawling suburban development in the townships of the Centre Region.

The State College Borough Council and its municipal managers are cognizant of the downtown character that residents, students, and tourists have come to love, but recognize the challenges that lie ahead in the landlocked borough that is the hub of Centre County.

The Borough Council has legislated through zoning where high-rise, or high-density, can plant its feet. The “core” of downtown is largely protected through height restrictions, with high-density pushed into a sort of U shape to the east, west and south. This keeps iconic properties off the chopping block to developers who may look across the street to Old Main and idealize it as a spot for a 12-story apartment building.

Tom Fountaine, borough manager, and Ed LeClear, planning and community development director, say it’s their goal to keep downtown thriving, diverse, walkable, and an affordable place for long-term residents to live.

“Our biggest challenge is affordability,” LeClear says.

LeClear and Fountaine say that keeping long-term residents in the borough aids the mission of keeping downtown business humming. That’s difficult to do, they add, in an environment where a need for student housing drives a creep of conversions of single-family homes and affordable rentals to student rentals on any parcel that’s walkable to campus.

“The demand for student housing hasn’t really been met yet,” LeClear says. “There is still a lack of supply market-wide.”

So instead of letting those beds slip into the townships and losing the tax revenue, State College government has found a way to live in two worlds: allow high-density in certain areas while protecting the charm and ambiance.

Roll the clock back about 15 years. State College Borough is geographically confined. There’s few places left to build. Penn State continues to grow. The Borough Council decides to allow provisions for some more density.

“The concept was: State College had reached a point where there was no room to grow, we were landlocked in terms of developable area,” Fountaine says. “There was a concept that high, vertical growth was a means of improving and increasing diversity within the community (and) at the same time, doing some things intentionally to try to maintain those sites as signature building sites, not necessarily just a free-for-all of redevelopment within the downtown corridor.”

The challenges the borough faces are not unique to State College. The market demand for student housing near campuses, the suffering of brick-and-mortar retail from online sales, decades of suburban sprawl, these are all national trends.

State College is fortunate, however, that its downtown never saw the level of deterioration that many Pennsylvania towns and cities have experienced over the last several decades, both urban and rural. Its population is increasing, despite statewide trends.

That doesn’t mean there aren’t challenges, or that local governments and businesses are powerless to act.

One of the requirements for high-density buildings is that they provide mixed uses: basically, businesses at the bottom, and housing on top. These mixed-use buildings allow for both office space and commercial activity near the street level. This also promotes walkability, a term that’s been on the lips of planners for years as young professionals more and more demand communities they can walk and bike in for the majority of their business. Public transportation helps that along, but the communities themselves must be walkable.

Though there is renewed focus on downtowns, and young adults generally prefer more walkable communities than their elders, some downtown businesses report that the landscape is troubling.

Douglas Albert has operated in downtown for 37 years. His business typically doesn’t draw students: he is the director of Douglas Albert Gallery along McAllister Alley.

“I think it sucks,” he says of recent development in the borough.

The shop owner says he is concerned about the continuing shift of demographics away from non-college-age residents in the borough, and retail slipping away and out of downtown.

“I am definitely concerned with what I see.”

Albert and other downtown retailers need each other, and say they need more of each other.

He reports some customers complain to him there aren’t enough places to shop nearby and he believes some people are avoiding downtown because fine retailers have either moved or closed. When those retailers close, it doesn’t necessarily mean a similar business will take up residence there.

“What really steams me is these prime retail buildings being turned over to nontraffic, non-retail buildings,” Albert says.

This, in combination with online sales, means the cards are stacked against retailers, he says.

However, Albert says he isn’t a total pessimist. He says the State College Downtown Improvement District made a great effort with events like Lion Bash, Happy Valley Music Fest, and First Night, the latter organized by the Central Pennsylvania Festival of the Arts.

He, like some other retailers, contends parking isn’t a problem and people can easily get to their destinations.

Tom Gallagher, president of The Music Mart, says the parking perception hurts his business along Beaver Avenue, even though a garage is close by. He says Albert jokes with him that The Music Mart is “up in Siberia,” meaning people come south on Pugh Street, look down Beaver Avenue in his direction, and don’t see much going on. He laments the online shopper mentality because his prices are just the same as online vendors, and the tax people think they’re avoiding paying should be paid anyway to help the state.

His mantra is the same as many local retailers: you’re just not going to get the same level of service from online shopping you get from a physical store.

But Gallagher says it gets harder to do business as storefront rent continues its steep climb and the variety of stores decreases. Gallagher agrees that First Night and music festivals are a good effort by local organizers to bring people into town. Overall, he says State College has remained vibrant and “the university has a lot to do with that.”

Students are a big part of his business, he says, not just local residents.

Over at Harper’s new location at 224 East College Avenue, owner Brian Cohen was doing brisk business on the Friday before the September 9 football game with Pitt.

“The potential for here is great,” Cohen says of the borough.

He encourages the larger buildings, saying they add to the electricity of State College, and he hopes the borough continues to grow.

“Downtown State College is a great place to be,” he says. “It’s at the center. It’s where the energy comes from.”

There used to be more retail in downtown, and that worries him, he says.

As with Albert, Cohen recognizes that more retail is actually better for his business, too. It makes for more destinations for shoppers.

Sharon Herlocher, whose family recently purchased property along College Avenue at Pugh Street, chairs the State College Downtown Improvement District board. She says it’s the organization’s mission to expand on the vibrant downtown, and promote anything that supports the “work, live, play” mantra.

“Local residents, visitors, students, retirees, we want everyone downtown,” Herlocher says.

DID is also responsible for much of the marketing outside of Centre County, all the way to Baltimore, Philadelphia, and upstate New York to draw people into town.

Herlocher says it’s also DID’s job to keep the town clean through trash pickup and to keep traffic flowing.

“Development is part of progress, but we absolutely want to work to keep the thoroughfares moving,” she says.

Even though development is changing the skyline, there are still the quiet, well-groomed neighborhoods and professional office buildings. But student housing is the sector where much of the development is happening, both through new building and conversion of traditional single-family homes.

LeClear says a consistent complaint during his roundtables with Penn State students is the poor quality of some of the housing, which can also include some of the older apartment buildings. So, while prices go up, quality can remain flat or diminish.

“The student-ification of neighborhoods has a similar impact that gentrification does in terms of driving prices up,” Fountaine says. “The results aren’t always the same. You don’t always end up with the improvements in properties as much as just increasing property values.”

Officials are using the Sustainable Neighborhoods program as a tool to purchase student rental properties and convert them back to single-family homes. The Redevelopment Authority has a $5 million line of credit for the program, and regains some of that money when the home sells. Though that’s a sinking fund, LeClear says, the borough sees its value in carving space in the rental market for young professionals.

The future of the borough depends upon the individual decisions of landowners, the mass action of local residents, the decisions of elected and appointed officials, the growth of Penn State, the preferences of its students, the guidance of local business organizations, the wisdom of shop owners, and the trends outside of any local’s control.

It is evident that State College isn’t going anywhere. It survived a scandal at Penn State that made national headlines and rocked Happy Valley. Students, alumni, and other visitors keep coming to town, parents keep enrolling their children at Penn State. The real estate market never crashed. The region continues to be an economic exception of Pennsylvania, in no small thanks to Penn State, but also upon the backs of locals simply wanting to do good business.

There’s no evidence those major threads have changed, even if some are strained and taken in new directions.

Sean Yoder is a staff writer for Town&Gown and the Centre County Gazette.



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