Partnership Puts St. James Rental Tower up for Sale

According to Sunter, New York-based Sonnenblick Goldman Co. is marketing the building to "a careful slice of the potential market." Steve Kohn, president of Sonnenblick, responded to all questions about the property with a firm no comment.

The building, which is the tallest residential structure in Center City, contains 306 residential units atop a 10-story parking garage and ground-floor retail, which currently includes a Starbucks. The building is approximately 50% leased and published rentals range from $1,495 a month for a studio to $7,000 a month for a three-bedroom, three-bath unit. Rental rates for penthouses are unpublished.

Sunter says, "there is no asking price" for the building. Of speculation that it would be in the range of $129 million, he says, "I don't think those speculating have any idea." Other members of the owner partnership are locally based P&A Associates and Atlanta-based Lend Lease Real Estate Investments, neither of which could be reached by deadline. Calls to Jack Noonan in the building's development office were not returned.

Last June, Allan Domb set a benchmark for Center City multifamily properties when he paid $227,272 a unit for the 88-unit rental building at 2031 Locust St. Two local real estate executives familiar with the Center City multifamily market, speaking on condition of anonymity, tell GlobeSt.com the St. James would likely set another benchmark, but differed on the price a buyer might pay. One suggested the price would probably be in excess of $350,000 a unit, or approximately $110 million, while the other said, "$250,000 a unit would be a huge price."

That source says, "the developers are probably looking to sell it for condo conversion, which would command a higher price-per-unit than a sale as a rental property. The price for condo conversion could command about $80,000 more a unit than a sale as a rental, this source adds that the 50% lease-up also favors a sale to a condo converter.

One of the anonymous sources tells GlobeSt.com, "generally a developer would hold onto a new property for five years in order to obtain the tax credits afforded the developer of a new building." Asked why the property is being marketed for sale, Sunter notes, "it was a partnership decision. I am not involved in the project."