THOSE THUGS who disrupted the opening gala at the Pearl Theater in December were firing live ammunition.

But it turns out it was all just a test.

The incident, which marred the $1 movie night at the Avenue North Complex at Broad and Oxford streets and which left one gunshot victim seriously injured, looked like a major setback for the $100 million development that community leaders had been working on for years.

Bart Blatstein's Tower Investments built the Pearl as the centerpiece of a block-square complex that houses retail outlets, restaurants and social-services facilities under one roof. It's the key project in a revitalization plan for a re-emerging swath of North Philadelphia where a number of commercial developments and 6,000 housing units have sprung up in the last 10 years.

Everyone said the right things after the shooting. Blatstein said he would not be deterred. Community and political leaders sounded determined. Indeed, the Pearl has been packing them in at its seven-screen multiplex.

But I really wasn't sure that their optimism would stand the test until last week, when Progress Investment Associates broke ground at Broad and Jefferson streets for the brand-new and much-improved Progress Plaza.

The shooting incident wasn't even an afterthought when I talked yesterday with Wendell R. Whitlock, who heads Progress Investment Associates.

"That was just a couple of knuckleheads" Whitlock said. "We weren't discouraged at all by that.

The $16 million renovation they are undertaking will only increase security on North Broad Street.

"There will be a lot more light and a lot more motion and activity," Whitlock said. "What we're doing just complements what's happening across the street."

What they are doing is updating and upgrading a dream that began 40 years ago at Zion Baptist Church at Broad and Venango. The concept came from the heart and head of the late Rev. Leon Sullivan. He sold his congregation and the rest of the city on the idea of building their own economic-development engine.

He called it the "360 plan."Investors bought shares at $1 a month for three years, creating a fund that financed the original Progress Plaza in 1968.

"They put $200 per share into a for-profit and $160 in a nonprofit fund," Whitlock said. "Reverend Sullivan warned them they weren't going to make much money."

They received one cash dividend in 40 years. But the success of the first shopping plaza ever built by a working-class community was a model that was replicated around the country. That was an added dividend.

In time, the plaza became a casualty of economic downturns and a sharp population decline as people moved out of North-Central Philadelphia for greener pastures. Progress Plaza barely remained afloat.

But a building boom, leveraged with public money, and Temple University's rapid expansion are repopulating and re-energizing the neighborhood. Progress Investments retooled its board and started raising funds.

"State Senator Shirley Kitchen was first," Whitlock said. "She found us $1 million for soft costs; Dwight Evans came up with $1 million and Curtis Thomas.

"Governor Rendell came up with $3 million. We got a half-million from the city Commerce Department."

All of which led to a favorable financing deal with the Reinvestment Fund that provided $10 million.

"We have begun work to extend the old Eckerd drugstore at Broad and Jefferson by 3,000 feet to include a Citizens Bank with drive-in windows, a Payless shoe store and a retailer to be named," Whitlock said.

Phase two will add 6,000 square feet to the office and retail complex at the back of plaza facing Broad Street. Patterson-Bittenbender, a joint venture between minority-owned and woman-owned construction companies, is scheduled to complete the first two phases by late fall. A 42,000-square-foot Fresh Grocer supermarket is slated for opening a year later.

"You better believe I was waving Reverend Sullivan's flag all the way," Whitlock said. "I couldn't have done this without his legacy."

A legacy that has been shown to be bulletproof. *

Send e-mail to smithel@phillynews.com or call 215-854-2512. For recent columns: http://go.philly.com/smith.