The $250 million apartment building was planned for the north end of the arena.
Officials said the building was slated to have nearly 400 apartments with a portion designated for affordable housing.
However, Councilmember Mark Squilla said in his conversations with residents that they were not convinced that the $250 million apartment tower, which would have included some affordable housing, would really benefit the people of Chinatown.
"The community wasn't supporting the arena," said Squilla, "but they really weren't supporting that development as a benefit for them."
"From day one we've said this arena is not bringing benefits to Chinatown," said John Chin of the Chinatown Development Corporation.
Chin said affordable housing would be an even bigger need if the arena were built.
"Rising real estate values and taxes are going to displace people," he said.
Squilla tells Action News part of the adjusted proposal will include plans to build affordable housing that's not attached to the arena. It would instead be in another area of Chinatown on land that the city owns. Still, leaders in Chinatown oppose the plan.
"It's like a runaway train that's not stopping for anything. That's how we feel," said Chin, "but if we're Chinatown, we can't give up."
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Last month, Mayor Cherelle Parker, who has thrown support behind the plans, detailed the proposal in front of a packed Pennsylvania Convention Center.
According to the agreement, the Sixers will finance the entire $1.3 billion project. No city funding is slated to be involved.
It's up to Squilla to decide if he'll introduce the legislation to City Council, which could happen as early as the scheduled council meeting on Thursday.
"Will you introduce this legislation (Thursday)?" asked Action News reporter TaRhonda Thomas.
"If we can get an Arena District that will be supported in this legislation, I will introduce it," said Squilla.
The Arena District is a group that Squilla would like to create and have included in the Community Benefits Agreement laid out by the city. The Arena District would include an oversight committee that would address issues of concern in Chinatown, including things like security to traffic, business impact, housing, and other community concerns.
If Squilla does introduce the proposal, he says there is no timeline for its final approval. There would be a mandatory 30-day period of public hearings, which Squilla said would include the full Philadelphia City Council hearing residents' concerns and comments at each hearing.
Demolition is expected to start in 2026 if the plan is approved by City Council. Construction would then start in 2028 followed by an opening in 2031.
Read the full statement released by Save Chinatown Coalition on plans to scrap the apartment building:
"The billionaires behind the arena don't care about affordable housing and the tower was always a PR sham. Councilman Squilla gave fuel to their lies and is pushing the Mayor's disgraceful deal that secures exactly $0 for the housing trust fund and affordable housing. They're letting rich developers off the hook despite housing being a central mission of the city and a stated priority for this Mayor. The city's getting taken for a ride, and Mayor Parker and Councilman Squilla are helping push the cart, lowering the bar for every development yet to come."