Major overhaul planned for Dow building

A partnership consisting of Keystone Property Group, Mack-Cali Realty Corp. and Parkway Corp. plans to invest more than $20 million in the Dow building in Center City as part of an overall plan to create a new destination on Independence Mall.

“We are designing and developing a product that will anchor the Market Street East part of Philadelphia, enhance the pedestrian experience and create a new scene that will augment the cityscape,” said Bill Glazer, president of Keystone Property Group of Bala Cynwyd, Pa.

To that end, Parkway Corp. will convert 55,000 square feet of basement space in the office building into a parking garage. It will have somewhere between 120 and 130 spaces.

Plans are also being developed to create a dynamic outdoor space on an existing plaza area along 6th Street. That includes incorporating a restaurant in 3,000 square feet of the property at the corner of 6th and Market streets. The building has a 40-foot setback, giving it ample room for a restaurant to have outdoor dining.

The partnership closed on buying the nine-story, 350,000-square-foot office building at 100 Independence Square West in early October but was reticent to talk about the transaction until now. It paid $40.5 million. Robert Fahey, Jerry Kranzel, Lizann McGowen and George Cauffman of CBRE Inc. represented Dow in the transaction.

The building is nearly fully leased to Dow Chemical, which has 173,000 square feet and the General Services Administration, which has 135,715 square feet.

This marks the first time Keystone has acquired a property in Philadelphia and is considered a “key step” in the company’s strategy to grow its portfolio of office properties.

Keystone has had a long relationship with Mack-Cali and the two companies are expected to continue partnering together on future acquisitions. Mack-Cali is shifting its focus to multifamily from office properties.

It’s not unusual for Parkway to team up with other developers when it sees a ripe opportunity.

“We are very excited to be partnering with Keystone and Mack-Cali on this project because we consider it to be a diamond in the rough,” said Robert Zuritsky, president of Parkway Corp. “We believe that after we add public parking and other enhancements to 100 Independence Mall West, it will become a new important asset for the neighborhood and the city.”

Source: Philadelphia Business Journal