EXCLUSIVE: $20M Takes Old City Properties

PHILADELPHIA-In partnership with Morristown, NJ-based Normandy Real Estate Partners, 806 Sar Partners has acquired three buildings in Old City, which it will convert from rental apartments into an aggregate of 90 for-sale condos. The properties are at 313 Arch, 209 Cuthbert and 8-10 Letitia Way.

The 806 Sar partnership acquired the buildings, all built in the early 1900s, for $20.4 million from three different sellers, Jacob Gehl tells GlobeSt.com. Gehl is one of 806 Sar's three partners. The others are Leo Addimando and Scott A. Radis. Locally based Miles and Generalis Inc. represented the buyer and Mallin Panchelli Nadel Realty, also based here, represented the three sellers. All three are local owners, according to Gehl. Among them are Growth Properties and Brandywine Construction, which is not affiliated with Brandywine Realty Trust, and a third, which is unidentified.

Residential units in the buildings average between 1,000 sf and 1,200 sf, Gehl says, and the buildings are "nearly fully occupied." Art galleries and boutiques are the primary occupants of the buildings' ground-floor retail space and will remain in place. Conversion of the residential units, Gehl says, will occur over the next two years and the cost has not yet been determined. Nor has the condo pricing, although he estimates it will be approximately $425 per sf.

"The acquisition represents our confidence in Old City and our opinion that Philadelphia remains the sweet spot for condominium development and conversion on the East Coast," Gehl says. His company is also currently developing 1234 Hamilton St. here, as previously reported in GlobeSt.com. It also owns multifamily, student housing and senior housing. Normandy recently closed on Normandy Real Estate Fund LP with a projected purchasing power of approximately $1.8 billion and is targeting Philadelphia, Boston, Metropolitan New York, Washington, DC and Northern New Jersey.