833 Chestnut, Philadelphia
AthenianRazak brought this massive office property from an original value of $7/sq. ft. to a sale price of $228/sq. ft. That was the highest price ever for an occupied office building in Philadelphia at the time of its sale. We redeveloped the property for a series of owners and managers, achieving a sale cap of 5.8; and an IRR of almost 10 over the final owner’s 10-year hold.
The story started when Lehman Bros. accepted the deed in 1998 with the building 27% occupied, and chose our team from a wide pool of candidates. We immediately created a redevelopment plan including phased infrastructure improvements, signed a new 80,000 sq. ft. lead tenant, completed a $42 million renovation including new electrical and mechanical systems, restoration of the historic masonry exterior, recreation of the historic cast iron storefronts, and a complete redesign of common areas and finishes – all with the building occupied. To finance the project, we secured a first mortgage, obtained an historic tax credit, and negotiated a $10 million tax abatement. We targeted and successfully secured a tenant mix of medical office, back office, and data centers, bringing the building to over 90% occupancy, and it sold at an historic high. <—Back