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PHILADELPHIA-Parkway Corp. has decided to resurrect plans for a tower it long-planned to develop above its six-story garage at 800 Walnut St. About 20 years ago, the locally based owner/developer created a plan for two towers above its garage on the parcel, and later sold rights above the western portion of the block to Wills Eye Medical Center, which has been completed.

The infrastructure for the second tower is in place and Parkway has approvals for a structure of as much as 275,000 sf on as many as 25 stories atop the existing garage, Robert Zuritsky, Parkway’s president, tells GlobeSt.com. The current Center City market conditions prompted him to unearth the plans now and “put out feelers and see if there’s interest,” he says.

Parkway has enlisted James Egan, SVP of the local office of Grubb & Ellis, to create a marketing package for the proposed development. The package will go out next week, Zuritsky says. It is unusual in that neither the plan nor the land is directly for sale. Parkway already has a tower design, and Egan has developed a series of parameters for the building, which includes office, hotel or residential options. The developer is seeking either an office user or a development partner.

Because of the potential variables, both Egan and Zuritsky say the marketing package carries no prices. “We’re testing the market to see which becomes the highest and best use of the location,” Egan tells GlobeSt.com.

Zuritsky says because of the property’s proximity to Jefferson University Hospital and Pennsylvania Hospital in addition to Wills, all of which are expanding, “medical office makes the most sense to me. Ideally, we’re seeking a tenant, so we can develop the property and be the landlord.”

Egan tells GlobeSt.com he intends to “contact all major user/developers in the office, medical office, hotel and residential segments.” The tightening office vacancy, expanding medical facilities and expansion of the Pennsylvania Convention Center make the first three options viable. Regarding residential, he says, “not condos, but rental apartments are in short supply.”

Under an office or medical office scenario, he says the project would likely be a build-to-suit, “most likely for a local company that’s already Downtown. There are not as many large blocks of office space in Center City as there were a year ago.” He says an office user’s rent rate would probably be in a range of between $30 per sf and $35 per sf, noting that medical offices would probably command a higher rent rate, depending on build-out.

Neither Zuritsky nor Egan would provide a projected cost of even a shell structure. “Apartment and hotel companies value differently from office users,” Egan says, “and the costs for each type of building would vary widely.” In a scenario other than office, he says Parkway would likely seek a joint-venture partner.

Parkway, which owns and operates most of the city’s parking garages, has several other developments under way here. Among them are the W Hotel & Residences at 12th and Arch streets in which it is partnering with Urban Residential; the 1706 Rittenhouse condominium with Scannapieco Development Corp., and the recently completed Pearl condos in Chinatown.

Despite what many have called a condo glut in Center City, Zuritsky says, 95 units in the 100-unit Pearl at 9th and Arch streets are sold. He acknowledges that they are considerably less pricey than the W and 1706 Rittenhouse condos, but says the 32-story Rittenhouse condo will break ground within a couple of months, and “we’ve had good activity for residences in W,” which is under way at 12th and Arch streets. Speaking of all three projects, he says, “each product is a niche, and all have been extremely well received.”

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