PHILADELPHIA-A joint partnership between Northfield, IL-based Next Realty and Apollo Real Estate Advisors bought two parking garages near Rittenhouse Square aggregating 40,000 sf, which includes a total of 7,800 sf of retail space. The price is undisclosed. On condition of anonymity, an area broker tells GlobeSt.com the tag was probably in the $20-million range.

The properties are at 1700 Chancellor St. and 1616 Sansom St. Robert Caplin, the Next Realty principal who represented both Next and Apollo in the transaction, tells GlobeSt.com, "Philadelphia's a strong, dynamic urban market that's having a great renaissance in residential and in retail. It also has large barriers to entry. We think this represents a wonderful opportunity for us."

The locations are in one of Center City's priciest residential and retail neighborhoods, and several residential condos are planned nearby. Asked if the partnership plans to redevelop the properties, Caplin says, "we will continue to operate them as garages and retail now; however, we will certainly look to pursue additional opportunities over time."

Among the tenants in the Chancellor Street property's 3,600 sf of retail are Little Pete's Restaurant, a dry cleaner and one vacant space. The Sansom Street location's 4,200 sf of retail is currently fully leased "to primarily service retailers, including a gift shop, hair and nail salon, Mr. Speedy and dry cleaner," Caplin says.

Next "looks for value-added retail," he says. It currently has a portfolio of two million sf of retail in the Midwest and Northeast "along with a growing portfolio of parking garages," he adds. In the past year, it has acquired three parking garages in Chicago and one at Bradley International Airport in Hartford. A Deptford, NJ property is its nearest to Philadelphia at present, but Caplin says the company is looking for additional opportunities here.

"We see the acquisition of these two parking garages as not only a great complement to our retail portfolio, but also as an opportunity to contribute to the re-emergence of a great American city," says Andrew Hochberg, Next's managing partner, in a statement. "Philadelphia has become a place where people would like to be, and that includes Next Realty."

Citing the city's "strong fundamentals," Richard Mack, an Apollo partner, says in a statement, "these acquisitions allow us to actively participate in the ongoing rejuvenation of Center City Philadelphia, and, in particular, the Rittenhouse Square area."

The seller is an institutional investor. The Eglin name is born on more than a dozen Center City parking garages. Caplin says the Eglin family, "a long-time owner of Philadelphia parking facilities," sold off many of them to different investors.