PHILADELPHIA-Ace American Insurance inks a multi-year lease for 156,150 sf in Penn Mutual Towers, taking the building’s occupancy to 94%. New York-based Broadway Real Estate Partners bought the office property at 510-530 Market St. here for $84.5 million in August 2003 and a team from the local office of Grubb & Ellis has taken occupancy from 79% to its current level.

This month, Broadway put the property on the sales block at an asking price of $115 million. J. Robert Clemens, EVP and managing director of G&E’s Philadelphia region, says, “the Ace transaction only enhances the owner’s confidence [in our team]…as the size of the deal will significantly increase the asset’s value.” Jim Egan VP, and Wayne Fischer, SVP, head the G&E leasing team.

Ace chose Penn Mutual after an “exhaustive search,” according to Egan, who attributed the choice to the property’s systems, location, views and management. Terms of the lease are undisclosed. When Broadway acquired the building, brokers familiar with the market told the asking rental rate was between $20.05 per sf and $23 per sf, a figure that one broker, on condition of anonymity, now says has not changed, but suggests the effective rate is lower.

The 880,208-sf property fronts both Independence Park and Washington Square Park. It is an assemblage of three conjoined buildings, two of which were completed in 1931 and are neoclassical in style. The third, a modern structure, was added in 1975, and all three were fully renovated in the 1990s. Among the other tenants are Beneficial Savings Bank, BDP International, the American Board of Internal Medicine, and a large regional office of Lippincott Williams and Wilkins. Robert Fahey, EVP of the local office of CB Richard Ellis, is marketing the building for sale on behalf of Broadway Partners.

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