In the heated competition for the worst new architecture in Philadelphia, the sickly yellow, synthetic-covered mid-rise across from the Reading Terminal Market is now the one to beat.

If the particular ugliness of the new Home2Suites at 12th and Arch Streets seems familiar, it is because this type of flimsy, style-challenged hotel is already a fixture at highway off-ramps across America. Grateful for shelter in far-flung places, we grudgingly accept the lack of architectural effort, even if we do slink off in the morning without so much as a backward glance.

It is a different matter entirely when a white-bread-loaf of a building like this makes its way onto a downtown street, into the company of chiseled stone centenarians like the Reading train shed. For people who have to walk by - and this includes the legions who visit the Convention Center - the effect is like being handed a plate of plastic play food at a fancy banquet.

Until now, even Philadelphia's most basic buildings have accepted the architectural requirement that they put on a tie and jacket when they've come into Center City. Their builders have employed respectable materials and tried to create something unique to the site. But Home2Suites is evidence that the postrecession building boom has altered the financial calculus.

Lenders are more cautious now, margins tighter. Big chains, once content to build on blank suburban sites, are finding that market saturated, and, instead, are swarming into the nation's reviving cities. Unfortunately, the chains are coming with their highway designs in tow. We can expect to see more architecture stamped out on the assembly line as new high-rises, retail chains, and casinos are built in cities.

Home2Suites, which opened Tuesday, was produced (designed is too strong a word) by Cope Linder Architects, the Philadelphia firm responsible for SugarHouse. The nine-story exterior is slathered in an artificial stucco-like material called Eifs, often sold under the brand Dryvit. Unlike the real thing, which glows softly and puts us in a Mediterranean state of mind, Eifs absorbs light. The hotel facade is so flat and plasticky it makes Parkway Corp.'s adjacent brick-and-concrete garage look like a work of heft and dignity. Tap the hotel's surface - but not too hard! - and you will hear the hollowness.

Just as fashion has become a throwaway commodity, so has architecture. There's a reason highway chain buildings are constantly replaced. In a decade, Home2Suites' Eifs facade will start to look worn out. The exterior is unlikely to survive past 30.

All this would be bad enough if the developers - Parkway and the Wurzak Hotel Group - had built the hotel entirely on their own dime. But as often happens in Philadelphia, this $59 million plastic box was enabled by lavish subsidies from the city, state, and federal governments, including money allocated under the recent stimulus program.

Taxpayers handed the developers almost $14 million in cash grants. Millions more were made available in other forms, including $10 million in New Markets tax credits and a $5 million, low-interest HUD loan. In 1998, the Philadelphia School District agreed to sacrifice $17 million in future city taxes so Parkway could obtain tax-incremental financing and build the garage, which is now linked directly to the hotel.

It's also worth noting that the site was then occupied by an eclectic row of 19th-century buildings, home to small businesses that once dreamed of cashing in on the Convention Center's presence - a diner, a dry cleaner, a shoe store, and yes, a porn shop. Though not particularly remarkable, those brick structures were relics of the neighborhood's colorful past, when the area bustled with small-scale publishing and print shops.

But the businesses were all kicked out by the Rendell administration in 1998 through the use of eminent domain. The buildings, which predated the 121-year-old Reading train shed, were demolished, and the land was sold to Parkway, which proceeded to park cars on the surface lot at some of the highest rates in town.

My beef isn't with the subsidies. If government grants are necessary to kick-start economic development, fine. Given the public investment in the Convention Center, a case can also be made for replacing those small buildings on 12th Street with something grander.

But just because you're subsidizing economic development doesn't mean you should be subsidizing poor design.

Philadelphia has a long history of underwriting some of its worst architecture. Symphony House condos, a notorious contender in the race to the bottom, received government support. So did the bland, new glass apartment tower 2116 Chestnut. Both are beauties compared to the hotel.

The rationale for giving these projects a helping hand is that Philadelphia's labor costs are very high - almost as high as New York's - but the returns here are much lower. Government subsidies effectively kill two birds with one stone: They enable unions to maintain high wages while helping developers reduce their costs.

In theory, the subsidies should also ensure that the city gets better-quality buildings.

Based on several accounts, Planning Director Alan Greenberger did, in fact, intervene with the developer to improve the hotel's design. As a result of his tinkering, the ground floor now features a generous amount of retail space with large, well-proportioned windows. In addition, the building's 25-foot setback, specified decades ago in the area's urban-renewal plan, allows for table seating and wide sidewalks. There's a green roof, bike racks, and street trees.

The developers say they also are proud that they were able to step up the design in the lobby, using more-sophisticated furnishings and lighting than the chain's standard to create a "cosmopolitan" atmosphere. But given the $40 million in public concessions, the city should have gotten more.

"Philly is a tough town," Parkway President Robert Zuritsky said in an interview. Before his deal with Home2Suites, a Hilton brand, Parkway struggled to woo a higher-end chain to the site, including a W Hotel, he said. At one point, Parkway, which was a partner in building condos at 1706 Rittenhouse, produced an attractive rendering for a residential tower, but the project sank with the recession.

The developers now have signed up two of the three retail spaces for Home2Suites' ground floor, with Panera Bread and BurgerFi, which will have a bar. Both chains, they say, will stay open into the night and help bring life to the area after business hours.

Luckily for the customers, it should be too dark by then to see the hotel that houses them.