Having grown up around Philly in those days (1963 or so) I always thought the line was "the hippest street in town".
But the official (record company) rendering of the first line is "hippies", meaning "those who are 'hip'" in the jazz lexicon. The song came out years before San Francisco-style hippies were known to the East Coast. The song refers to "hipsters", that is, cool R&B/soul/jazz-oriented folks.
See also http://en.wikipedia.org/wiki/Hippie_(etymology)#Hip.2C_hipster_and_hippie, third paragraph.