(To read more on the multifamily market, click here.)
PHILADELPHIA-After winning a five-year legal struggle with the owner of neighboring land and gaining approval for a 57-story residential condo tower at 1441 Chestnut St., Ardmore-based Mariner Commercial Properties has put the land and plans out to market. Timothy Mahoney, head of Mariner, and local philanthropist Brook Lenfest, Mahoney's partner in the project, have enlisted CB Richard Ellis to market the package.
Mahoney tells GlobeSt.com, "A sale is one of three options we're putting out there--that or a JV or developing it ourselves. We've been working on this for seven years, and, once we got approvals, the phone started ringing. I was surprised at what other developers thought it was worth."
He adds that seven years is Mariner's typical investment horizon. "Seven years ago I didn't think I'd be just getting into ground in 2006 or 2007. Now, it's a 12-year project. We owe it to our investors to see what options are available." Asked what he'd invested to date, he says, "seven years of my life and untold millions."
The package is unpriced, according to Mahoney and Robert Fahey, the CBRE SVP who's leading the marketing effort. "The condo market in Philadelphia is very healthy and this has attracted many, many national developers," Fahey tells GlobeSt.com. "We've just begun and expect there will be interest among international buyers, too." The package includes all development rights, including zoning for 840,000-sf density; the 24,000-sf land parcel, and plans, which are between conceptual and final construction drawings. "The approvals are unappealable."
On condition of anonymity, an area broker tells GlobeSt.com, "the market value of the site, based on FAR [floor area ratio], is between $80 per sf and $100 per sf, which would put the projected price tag at between $60 million and $84 million." Mahoney says, "I'd say that's probably the appropriate range."
Of a sale, he says, "I'd feel a little tweak in my heart. This has been like getting a troublesome child through college. But, it depends on the number. I'd love to see [a buyer] stay with our design, and I'd be proud to see it come to fruition." The Mariner plan calls for 294 condo units. In December 2005, Mahoney told GlobeSt.com that units would range from 1,100 sf to potential half-floor, 5,000-sf penthouses. He estimated the construction cost at between $200 million and $250 million and said unit prices would be in excess of $700 per sf.
The land is a portion of the former site of the Meridian office tower across from City Hall, which was destroyed by fire in 1991. Locally based Arden Group owns the other portion and is developing a 44-story, 280-unit condo, Residences at the Ritz-Carlton. Arden, which is headed by Craig Spencer, also owns the adjacent Ritz-Carlton Hotel.
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