William Penn is generally credited with the introduction of coffee into the Quaker colony which he founded on the Delaware in 1682. He also brought to the "city of brotherly love" that other great drink of human brotherhood, tea. At first (1700), "like tea, coffee was only a drink for the well-to-do, except in sips."[93] As was the case in the other English colonies, coffee languished for a time while tea rose in favor, more especially in the home.

Following the stamp act of 1765, and the tea tax of 1767, the Pennsylvania Colony joined hands with the others in a general tea boycott; and coffee received the same impetus as elsewhere in the colonies that became the thirteen original states.

The coffee houses of early Philadelphia loom large in the history of the city and the republic. Picturesque in themselves, with their distinctive colonial architecture, their associations also were romantic. Many a civic, sociological, and industrial reform came into existence in the low-ceilinged, sanded-floor main rooms of the city's early coffee houses.

For many years, Ye coffee house, the two London coffee houses, and the City tavern (also known as the Merchants coffee house) each in its turn dominated the official and social life of Philadelphia. The earlier houses were the regular meeting places of Quaker municipal officers, ship captains, and merchants who came to transact public and private business. As the outbreak of the Revolution drew near, fiery colonials, many in Quaker garb, congregated there to argue against British oppression of the colonies. After the Revolution, the leading citizens resorted to the coffee house to dine and sup and to hold their social functions.

When the city was founded in 1682, coffee cost too much to admit of its being retailed to the general public at coffee houses. William Penn wrote in his Accounts that in 1683 coffee in the berry was sometimes procured in New York at a cost of eighteen shillings nine pence the pound, equal to about $4.68. He told also that meals were served in the ordinaries at six pence (equal to twelve cents), to wit: "We have seven ordinaries for the entertainment of strangers and for workmen that are not housekeepers, and a good meal is to be had there for six pence sterling." With green coffee costing $4.68 a pound, making the price of a cup about seventeen cents, it is not likely that coffee was on the menus of the ordinaries serving meals at twelve cents each. Ale was the common meal-time beverage.

There were four classes of public houses—inns, taverns, ordinaries, and coffee houses. The inn was a modest hotel that supplied lodgings, food, and drink, the beverages consisting mostly of ale, port, Jamaica rum, and Madeira wine. The tavern, though accommodating guests with bed and board, was more of a drinking place than a lodging house. The ordinary combined the characteristics of a restaurant and a boarding house. The coffee house was a pretentious tavern, dispensing, in most cases, intoxicating drinks as well as coffee.

Philadelphia's First Coffee House

The first house of public resort opened in Philadelphia bore the name of the Blue Anchor tavern, and was probably established in 1683 or 1684; colonial records do not state definitely. As its name indicates, this was a tavern. The first coffee house came into existence about the year 1700. Watson, in one place in his Annals of the city, says 1700, but in another 1702. The earlier date is thought to be correct, and is seemingly substantiated by the co-authors Scharf and Westcott in their History of the city, in which they say, "The first public house designated as a coffee house was built in Penn's time [1682–1701] by Samuel Carpenter, on the east side of Front Street, probably above Walnut Street. That it was the first of its kind—the only one in fact for some years—seems to be established beyond doubt. It was always referred to in old times as 'Ye Coffee House.'"

Carpenter owned also the Globe inn, which was separated from Ye coffee house by a public stairway running down from Front Street to Water Street, and, it is supposed, to Carpenter's Wharf. The exact location of the old house was recently established from the title to the original patentee, Samuel Carpenter, by a Philadelphia real-estate title-guarantee company, as being between Walnut and Chestnut Streets, and occupying six and a half feet of what is now No. 137 South Front Street and the whole of No. 139.

How long Ye coffee house endured is uncertain. It was last mentioned in colonial records in a real estate conveyance from Carpenter to Samuel Finney, dated April 26, 1703. In that document it is described as "That brick Messuage, or Tenement, called Ye Coffee House, in the possession of Henry Flower, and situate, lying and being upon or before the bank of the Delaware River, containing in length about thirty feet and in breadth about twenty-four."

The Henry Flower mentioned as the proprietor of Philadelphia's first coffee house, was postmaster of the province for a number of years, and it is believed that Ye coffee house also did duty as the post-office for a time. Benjamin Franklin's Pennsylvania Gazette, in an issue published in 1734, has this advertisement:

Flower's advertisement would indicate that Ye coffee house, then venerable enough to be designated as old, was still in existence, and that Flower was to be found there. Franklin also seems to have been in the coffee business, for in several issues of the Gazette around the year 1740 he advertised: "Very good coffee sold by the Printer."

The First London Coffee House

Philadelphia's second coffee house bore the name of the London coffee house, which title was later used for the resort William Bradford opened in 1754. The first house of this name was built in 1702, but there seems to be some doubt about its location. Writing in the American Historical Register, Charles H. Browning says: "William Rodney came to Philadelphia with Penn in 1682, and resided in Kent County, where he died in 1708; he built the old London coffee house at Front and Market Streets in 1702." Another chronicler gives its location as "above Walnut Street, either on the east side of Water Street, or on Delaware Avenue, or, as the streets are very close together, it may have been on both. John Shewbert, its proprietor, was a parishioner of Christ Church, and his establishment was largely patronized by Church of England people." It was also the gathering place of the followers of Penn and the Proprietary party, while their opponents, the political cohorts of Colonel Quarry, frequented Ye coffee house.

The first London coffee house resembled a fashionable club house in its later years, suitable for the "genteel" entertainments of the well-to-do Philadelphians. Ye coffee house was more of a commercial or public exchange. Evidence of the gentility of the London is given by John William Wallace:

One of the many historic incidents connected with this old house was the visit there by William Penn's eldest son, John, in 1733, when he entertained the General Assembly of the province on one day and on the next feasted the City Corporation.

Roberts' Coffee House

Another house with some fame in the middle of the eighteenth century was Roberts' coffee house, which stood in Front Street near the first London house. Though its opening date is unknown, it is believed to have come into existence about 1740. In 1744 a British army officer recruiting troops for service in Jamaica advertised in the newspaper of the day that he could be seen at the Widow Roberts' coffee house. During the French and Indian War, when Philadelphia was in grave danger of attack by French and Spanish privateers, the citizens felt so great relief when the British ship Otter came to the rescue, that they proposed a public banquet in honor of the Otter's captain to be held at Roberts' coffee house. For some unrecorded reason the entertainment was not given; probably because the house was too small to accommodate all the citizens desiring to attend. Widow Roberts retired in 1754.

The James Coffee House

Contemporary with Roberts' coffee house was the resort run first by Widow James, and later by her son, James James. It was established in 1744, and occupied a large wooden building on the northwest corner of Front and Walnut Streets. It was patronized by Governor Thomas and many of his political followers, and its name frequently appeared in the news and advertising columns of the Pennsylvania Gazette.

The Second London Coffee House

Probably the most celebrated coffee house in Penn's city was the one established by William Bradford, printer of the Pennsylvania Journal. It was on the southwest corner of Second and Market Streets, and was named the London coffee house, the second house in Philadelphia to bear that title. The building had stood since 1702, when Charles Reed, later mayor of the city, put it up on land which he bought from Letitia Penn, daughter of William Penn, the founder. Bradford was the first to use the structure for coffee-house purposes, and he tells his reason for entering upon the business in his petition to the governor for a license: "Having been advised to keep a Coffee House for the benefit of merchants and traders, and as some people may at times be desirous to be furnished with other liquors besides coffee, your petitioner apprehends it is necessary to have the Governor's license." This would indicate that in that day coffee was drunk as a refreshment between meals, as were spirituous liquors for so many years before, and thereafter up to 1920.

Bradford's London coffee house seems to have been a joint-stock enterprise, for in his Journal of April 11, 1754, appeared this notice: "Subscribers to a public coffee house are invited to meet at the Courthouse on Friday, the 19th instant, at 3 o'clock, to choose trustees agreeably to the plan of subscription."

The building was a three-story wooden structure, with an attic that some historians count as the fourth story. There was a wooden awning one-story high extending out to cover the sidewalk before the coffee house. The entrance was on Market (then known as High) Street.

The London coffee house was "the pulsating heart of excitement, enterprise, and patriotism" of the early city. The most active citizens congregated there—merchants, shipmasters, travelers from other colonies and countries, crown and provincial officers. The governor and persons of equal note went there at certain hours "to sip their coffee from the hissing urn, and some of those stately visitors had their own stalls." It had also the character of a mercantile exchange—carriages, horses, foodstuffs, and the like being sold there at auction. It is further related that the early slave-holding Philadelphians sold negro men, women, and children at vendue, exhibiting the slaves on a platform set up in the street before the coffee house.

The resort was the barometer of public sentiment. It was in the street before this house that a newspaper published in Barbados, bearing a stamp in accordance with the provisions of the stamp act, was publicly burned in 1765, amid the cheers of bystanders. It was here that Captain Wise of the brig Minerva, from Pool, England, who brought news of the repeal of the act, was enthusiastically greeted by the crowd in May, 1766. Here, too, for several years the fishermen set up May poles.

Bradford gave up the coffee house when he joined the newly formed Revolutionary army as major, later becoming a colonel. When the British entered the city in September, 1777, the officers resorted to the London coffee house, which was much frequented by Tory sympathizers. After the British had evacuated the city, Colonel Bradford resumed proprietorship; but he found a change in the public's attitude toward the old resort, and thereafter its fortunes began to decline, probably hastened by the keen competition offered by the City tavern, which had been opened a few years before.

Bradford gave up the lease in 1780, transferring the property to John Pemberton, who leased it to Gifford Dally. Pemberton was a Friend, and his scruples about gambling and other sins are well exhibited in the terms of the lease in which said Dally "covenants and agrees and promises that he will exert his endeavors as a Christian to preserve decency and order in said house, and to discourage the profanation of the sacred name of God Almighty by cursing, swearing, etc., and that the house on the first day of the week shall always be kept closed from public use." It is further covenanted that "under a penalty of £100 he will not allow or suffer any person to use, or play at, or divert themselves with cards, dice, backgammon, or any other unlawful game."

It would seem from the terms of the lease that what Pemberton thought were ungodly things, were countenanced in other coffee houses of the day. Perhaps the regulations were too strict; for a few years later the house had passed into the hands of John Stokes, who used it as dwelling and a store.

City Tavern or Merchants Coffee House

The last of the celebrated coffee houses in Philadelphia was built in 1773 under the name of the City tavern, which later became known as the Merchants coffee house, possibly after the house of the same name that was then famous in New York. It stood in Second Street near Walnut Street, and in some respects was even more noted than Bradford's London coffee house, with which it had to compete in its early days.

The City tavern was patterned after the best London coffee houses; and when opened, it was looked upon as the finest and largest of its kind in America. It was three stories high, built of brick, and had several large club rooms, two of which were connected by a wide doorway that, when open, made a large dining room fifty feet long.

Daniel Smith was the first proprietor, and he opened it to the public early in 1774. Before the Revolution, Smith had a hard struggle trying to win patronage from Bradford's London coffee house, standing only a few blocks away. But during and after the war, the City tavern gradually took the lead, and for more than a quarter of a century was the principal gathering place of the city. At first, the house had various names in the public mind, some calling it by its proper title, the City tavern, others attaching the name of the proprietor and designating it as Smith's tavern, while still others used the title, the New tavern.

The gentlefolk of the city resorted to the City tavern after the Revolution as they had to Bradford's coffee house before. However, before reaching this high estate, it once was near destruction at the hands of the Tories, who threatened to tear it down. That was when it was proposed to hold a banquet there in honor of Mrs. George Washington, who had stopped in the city in 1776 while on the way to meet her distinguished husband, then at Cambridge in Massachusetts, taking over command of the American army. Trouble was averted by Mrs. Washington tactfully declining to appear at the tavern.

After peace came, the house was the scene of many of the fashionable entertainments of the period. Here met the City Dancing Assembly, and here was held the brilliant fête given by M. Gerard, first accredited representative from France to the United States, in honor of Louis XVI's birthday. Washington, Jefferson, Hamilton, and other leaders of public thought were more or less frequent visitors when in Philadelphia.

The exact date when the City tavern became the Merchants coffee house is unknown. When James Kitchen became proprietor, at the beginning of the nineteenth century, it was so called. In 1806 Kitchen turned the house into a bourse, or mercantile exchange. By that time clubs and hotels had come into fashion, and the coffee-house idea was losing caste with the élite of the city.

In the year 1806 William Renshaw planned to open the Exchange coffee house in the Bingham mansion on Third Street. He even solicited subscriptions to the enterprise, saying that he proposed to keep a marine diary and a registry of vessels for sale, to receive and to forward ships' letter bags, and to have accommodations for holding auctions. But he was persuaded from the idea, partly by the fact that the Merchants coffee house seemed to be satisfactorily filling that particular niche in the city life, and partly because the hotel business offered better inducements. He abandoned the plan, and opened the Mansion House hotel in the Bingham residence in 1807.