Philly’s commuter foot traffic recovery stalls while Center City offices get emptier

A lack of commuters meant 8.1 million square feet of empty office space in 2023, up from 4.2 million in 2019, according to the annual Center City District report.

The heart of Philadelphia commerce in Center City.

The heart of Philadelphia commerce in Center City. (Kimberly Paynter/WHYY)

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One key economic indicator for Philadelphia’s Center City District doesn’t appear to be steadily improving anymore – commuters returning to the office.

About 70% of non-resident workers who commuted before the COVID-19 pandemic still did that during the fourth quarter of 2023, according to anonymized cell phone data collected by and crunched by the Center City District.

That metric had been slowing ticking upward, from 49% in 2022 to 66% in early 2023.

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But now it’s been the same for the past three quarters in a row at the 70% mark.

“It might be time to stop talking about recovery,” said Prema Katari Gupta, the new CEO of Philadelphia’s Center City District. “Maybe our cities will never go back no matter how hard we will them to where we were in 2019. It’s time to embrace the unanticipated strengths but also the exposed vulnerabilities and really work hard to build a downtown that the region needs.”

It could be that commuters are now Center City residents, but offices are increasingly empty as businesses are leasing less space downtown.

There is about 46 million square feet of office space across Center City, about 8.1 million square feet of which sits vacant as of 2023. That’s nearly 4 million square feet more than in 2019.

Where a commuter lives makes a difference about whether they are back in the office, Center City District researchers found.

Workers who live more than 10 miles away from Center City were least likely to be back in the office – about 55% of whom commuted during the fourth quarter of 2023.

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For those who live five to 10 miles away, about 67% were back in the office. Commuters who live two to five miles away from work 78% were back at the office, and among those who live within two miles of where they work, 92% were at their desks.

The City Council Committee on Commerce and Economic Development is slated to hold hearings to investigate commercial office market viability in Center City soon. The effort is spearheaded by Philadelphia City Councilmember Jeffrey Young Jr., whose district includes parts of downtown.

Still, Philadelphia’s office market occupancy is stronger than most of its peer cities, with an occupancy rate of 80% — only behind midtown Manhattan. There’s more office space vacancy in downtown office districts in Washington, D.C., Chicago, Nashville, San Diego, Boston, Atlanta, Houston, Los Angeles, Phoenix, Austin and Dallas.

There’s already some Center City office buildings undergoing conversions to residential complexes — as 40 buildings have already done over the past two decades.

During the transition phases, the Center City District expects to focus on the basics.

“Regardless of what land use might be in a historic building, people want to see clean sidewalks,” Katari Gupta said.

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