About 30 rental units would be built above the retail space, instead of office space, as a previous plan had called for, said Shahied Dawan, Universal's executive vice president.
Thirteen parking spaces would be available at the site, and six market-rate townhouses with garages would be built behind the theater, facing Kater Street.
The new plan seemed to be mostly well-received by the residents who piled into a second-floor room at the Bainbridge Club, on Bainbridge Street near 15th.
"I thought [the meeting] was going to be more controversial," said Marcus Iannozzi, the president of the South Street West Business Association's steering committee. "I think a lot of people are delighted that something is finally happening."
Iannozzi noted that the plan was only preliminary, and said he hoped some residents' suggestions could be worked into the project.
Universal has committed to working closely with South Street West and the South of South Neighborhood Association.
Last night's meeting was clearly aimed at clearing the air with local residents, some of whom complained bitterly about Universal's efforts over the years to maintain the property. But a number of hurdles have to be cleared before the project can take shape.
Universal still has to contend with court proceedings over a complaint that was filed earlier this year by Juan Levy, a local resident who is trying to have developer Ori Feibush made the Royal's conservator.
Zoning variances would likely be needed before the project could take shape. Universal wants to reapply for a $2.25 million grant from the state's Redevelopment Assistance Capital Program, which it lost after prior plans to redevelop the Royal stalled.
The company will also have to contend with the Philadelphia Historical Commission, which blocked Universal's attempt earlier this year to get permission to demolish the theater.
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