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Developer outlines Polyclinic hospital campus plan: 130 units, retail and grocery space; council to vote later
Summary
Penmark presented a second-phase plan to convert the Polyclinic’s main hospital building into mixed use with about 130 residential units, ~15,000 sq ft of retail (including a potential local grocery), and a 440-space parking garage; planning conditions include ADA sidewalk reconstruction and refuse consolidation. Council moved the land-development resolution to the legislative session.
The City planning bureau and Penmark Harrisburg Holdings updated council on the Polyclinic hospital campus redevelopment (Resolution 5 of 2026). The proposed second phase would convert the main hospital building into mixed uses, featuring roughly 130 residential units (studios to three-bedrooms), about 15,000 square feet of retail/flex space facing 4th Street, and a parking garage in the neighborhood of 440 spaces.
Planning staff summarized recommended conditions: reconstruct portions of the 4th Street sidewalk to be ADA-compliant (including raised crosswalks at trucks’ loading-dock points), coordinate refuse storage and screening with Public Works, ensure signage conforms to code or seek zoning relief, and provide sheltered bike parking and secured bike storage. The project team emphasized flexibility in the plan to allow retail or community space to evolve as the project proceeds.
Greg Hallquist (Penmark) presented detailed progress on Building 3 (phase 1) and the schedule for Building 1 (phase 2), noting demolition progress, building-permit receipt (January 13) and ongoing historic-tax-credit preparation that covers multiple campus buildings. Hallquist said site logistics are being tightened, neighbor meetings are ongoing (two community meetings scheduled), and the project anticipates substantial local construction employment and a multi-million dollar construction budget.
Council members asked about unit mix, rent ranges and the possibility of grocery/retail uses. Penmark said ground-floor retail conversations are underway with a local grocer and that rents for some units are aiming at market-rate levels (mid‑$900s for studios and about $1,300–$1,600 for one‑ and two‑beds), with financing constraints limiting deeper affordability unless tax-credit financing is obtained.
Council moved the matter to the next legislative session for a formal vote. The planning bureau’s conditions will remain in the record for permit review and public follow-up.
What happens next: The resolution will be scheduled for a recorded vote in the legislative session; project applicants and planning staff will continue community outreach and finalize historic-tax-credit and financing steps.
