A Philadelphia office building that houses Temple University’s Center City campus has come up for sale.
Referred to by its address, 1515 Market St., it stands 20 stories, totals 502,000 square feet and could trade for as high as $85 million, according to one estimate. By comparison, its neighbor across the plaza, Two Penn Center, sold for about $66 million in 2012. Two Penn is also 20 stories and totals 505,000 square feet. It was roughly 82 percent occupied when it sold.
Among 1515 Market’s strengths are renovations it underwent in 2007 and having Temple as a long-term anchor tenant. The university occupies nearly 128,000 square feet, and the school recently renewed its lease to occupy its space through June 2022. Other tenants include Sweeney & Sheehan, Heffler Radetich & Saitta and the Commonwealth of Pennsylvania. It is 87 percent occupied.
The building has 15,189 square feet of retail space.
The structure also sits directly across from the recently renovated Dilworth Park at City Hall, a setting that enhances the property’s value, said Doug Rodio, an investment broker with JLL. Jim Galbally, John Plower and Rodio are marketing the property for sale.
“Dilworth Park dramatically helps this property,” Rodio said. “The money spent on the park not only will help the city but 1515 is a direct beneficiary of it as well.”
Dilworth Park has a cafe, a redesigned transit hub and entertainment. In the winter, it will have an ice skating rink.
But 1515 Market isn’t without blemishes.
Stockton Real Estate Advisors of Philadelphia bought 1515 Market in 2007 for around $75 million. By 2011, a CMBS loan on it was shipped to a special servicer and was listed in maturity default. It had a balance, exclusive of interest, default interest and late charges, of roughly $70 million.
Winthrop Realty Trust of Boston bought in 2012 the $70 million note at a discount. The company paid $56.85 million for it.
This past August, Winthrop decided to liquidate and sell all of its properties and complete that process by August 2016. It owns nearly $1 billion of office and multifamily real estate. In Philadelphia, 1515 Market is the only property it owns.