Have Philadelphia Labor Unions Finally Been Beat?

Pestronk brothers set to receive applications for new Goldtex apartments this week.

One of Philadelphia’s most watched civic dramas could be coming to a close and escalating, all at once. Developers Matt and Mike Pestronk are opening the Goldtex apartment building on Wood Street on May 1st, and they will begin taking leasing applications on Friday.

The move signals an end, of sorts, to a dispute between the Pestronks and this city’s Building Trades, which began when the brothers tried awarding only a portion of the Goldtex work to union labor. The unions picketed the job site, chanting “all or none!” But the Pestronks held their ground, saying they couldn’t meet union wage demands and turn a profit.

The result was the single-biggest union dispute this city has seen in decades. The Pestronks accused the unions of intimidation tactics—pouring oil across the site’s entrance, issuing death threats, shoving nonunion employees working the project. What’s more, they even caught much of the action on video and posted it online and won a restraining order against picketers.

The unions denied the Pestronks’ allegations, accusing them of selectively editing the videos they released. With 163 apartment units coming online, the Pestronks say a message has been sent to the city’s developers and nonunion, or “open shop,” contractors.

“We won,” says Matt Pestronk. “We’re opening. The electricity is done. We’re just drywalling and installing kitchens now. And the trades are in a bad spot. Because they started a fight they couldn’t finish.”

Frank Keel, spokesman for electrician’s union leader John Dougherty, did not return a phone call seeking a comment. But last fall he called the Goldtex site “the acid test” for the city’s unions.

So is this it? Is the era of union dominance in Philadelphia over?

Mary Tebeau, president of Eastern Pennsylvania’s Associated Builders and Contractors, the trade organization representing open shop contractors, said last fall that if the Pestronks pulled this job off without union labor, it will act as encouragement for other builders willing to take on the city’s unions. The key, she said, would also lie in showing that the project could successfully turn a profit.

After all, the Pestronks may have saved money on labor costs, but they spent extra money on various other things, including cameras and extra security. They also had to deal with extra costs in the form of delays caused by protestors. But Pestronk says they’ll cross that bar, too.

“It’s going to be profitable,” says Matt Pestronk. “That’s what we set out to do, to have a financially successful project. And we’ve done it.”