Philadelphia councilwoman delayed major city land deal to help a developer

Philadelphia Councilwoman Jannie Blackwell froze the sale of 4601 Market to help developer and Belmont Charter School Network CEO Michael Karp.

Philadelphia officials have decided to sell the city property at 4601 Market St. for $10 million. The sale had been held up for months. (PlanPhilly file)

Philadelphia officials have decided to sell the city property at 4601 Market St. for $10 million. The sale had been held up for months. (PlanPhilly file)

Updated 10:39 a.m. Sunday 

The city’s stalled redevelopment of a property at 4601 Market St. finally advanced Thursday after West Philadelphia Councilwoman Jannie Blackwell reversed her opposition.

A document indicates Blackwell’s reservations stemmed from the concerns of a single real estate developer: Michael Karp, leader of two large West Philadelphia organizations — University City Housing and the Belmont Charter Network.

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The saga began in December when Blackwell froze a bill to move forward the sale of the former Provident Mutual Life Insurance building, despite the objections of Mayor Jim Kenney’s administration. The city had invested $52 million into the palatial structure with the intent of turning it into a new police headquarters, but later put it up for public bid after the department instead announced a plan to move to 400 North Broad St.

On Thursday, Blackwell told her colleagues that she would continue holding the bill. Just days earlier, she had said — at a public meeting — that she supported the project because of its broad community backing.

“We had one more little community glitch,” Blackwell said on Thursday. “We work that out, and we’ll see.”

But two hours later, Blackwell abruptly brought the bill to a floor vote.

“I got a letter from the mayor stating that he would work with us to make sure that all the issues that needed to be resolved will be resolved,” Blackwell said when asked the reason for her sudden change of heart.

Blackwell declined to offer any more details on the substance of her concerns or the mayor’s assurances.

The letter from Kenney indicates that the councilwoman’s concern revolved around Karp’s interests.

“I am aware of the issues that you brought to my attention regarding Michael Karp, and I look forward to continuing to work with you to resolve them,” Kenney wrote in the signed letter dated Feb. 7, 2019.

Karp was a partner in one of three finalist bids for the 13-acre former Provident Mutual Life Insurance building. The proposal he helped put forward would have offered educational services and social supports. But that bid ultimately lost to the proposal for a health campus spearheaded by Iron Stone Real Estate Partners.

Karp’s ties to Blackwell’s district run deep. He was one of the first developers to begin renovating University City’s elegant townhouses for student living and an early advocate of charter schools, founding Belmont in the late 1990s.

He sits on the board of the Pennsylvania Intergovernmental Cooperation Authority, a fiscal oversight board that must approve Philadelphia City’s budgets. In the 1990s, he sat on the Philadelphia Board of Education.

Karp said in an interview on Friday that he knew nothing about correspondence on his behalf between the mayor and Blackwell.

“I have not seen the letter, I was not involved in her discussions with the mayor around that letter,” said Karp, when told that Blackwell only lifted the hold when she received assurances about mayoral attention to his specific “issues.”

Those issues, he said, include a desire to expand the services that his Belmont Charter Network schools offer. He wants a contract from Philadelphia’s Department of Human Services that would allow for the provision of social assistance programs to students and their families. There is a theoretical connection to 4601 Market: The contract would enable him to provide the services he wanted to bring to the vacant city-owned building.

He also wants to purchase the original Belmont school building, at 4030 Brown St., which the school district owns. He believes the mayor can help him do that.

“The mayor controls the school district,” said Karp. “Here’s local control, here’s the fact he appointed all the school board members to do the right thing. But nothing happened!”

The mayor’s office does not completely control either of the issues that Karp wants to be addressed. The DHS contract would have to be agreed to by city and state authorities. Selling the school building would require a vote from the school board, but the mayor is not directly involved in their deliberations.

Karp said both he and Blackwell are frustrated that his plans for the school building haven’t advanced.

“To be candid with you … [this is about her] frustration that things [we are trying to do] for the community are not moving forward and she’s very disappointed.”

Blackwell’s actions on 4601 Market inspired several unusually critical statements from Kenney.

“I could never figure out what the issues were,” Kenney said on Thursday immediately after the vote. “It mystifies me.”

Asked about the contents of the letter, the mayor replied:  “I said we would continue to work with her and listen to her concerns, which we would do anyway.”

The administration declined any further comment.

Most of the interest groups in her district opposed Blackwell’s hold on the land deal. These included neighborhood organizations that won community benefits agreements from Iron Stone, as well as the only majority-black construction union in Philadelphia, the Laborers. The union was excited by Iron Stone’s commitment to minority contracting.

“I’ve never seen such unanimity of support for [a project] and I think people were getting a little aggravated at the length of time it was taking to bring her to a vote,” Kenney said.

Blackwell has held her West Philadelphia Council seat for decades, but this year she faces a primary challenge from Jamie Gauthier, former head of the Fairmount Park Conservancy. Blackwell had the least cash on hand of any incumbent Council member at the end of 2018.

Karp has made campaign contributions to Blackwell in the past but did not do so last year, according to campaign finance reports.

This story has been updated to clarify that the Laborers are the only majority-black construction union in Philadelphia. 

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