The owner of two iconic apartment complexes in Center City
will invest more than $150 million repositioning the properties.
Aimco, owner of the Sterling and Park Towne Place, had been
planning to upgrade the properties for some time but is finally moving forward
with the improvements with an eye toward competing in an apartment market that
is facing increased competition from new multifamily developments.
As new apartment projects come onto the market, existing
landlords will be faced with the question about what to do with their
properties. Their dilemma: maintain the status quo and be a low-cost
alternative or plow possibly tens of millions of dollars into their property to
compete.
Aimco is taking the latter approach, which is part of its
overall business strategy. The Denver, Colo., real estate company likes to buy
what it deems as great properties in great locations, said Patti Shwayder,
senior vice president at the company. Philadelphia is one of its target markets
and it is always on the hunt to build up its portfolio here.
In the meantime, it is embarking on a major overhaul of
these two properties.
“After the downturn, we, like many other companies, looked
at the gems in our portfolio and these are at the top of that list,” she said.
The company plans to totally transform the two properties to
bring them up to trophy level and will look to set rents commensurate with that
status. What those rents will end up being is unknown for now since the work
will take two to three years to complete. At that time, Aimco will analyze
where the market is and set rents accordingly. For certain, rents will go up
from where they are now.
Barton Partners of Norristown, Pa., is the architect of
record for both projects. Tryba Architects of Denver is the design architect on
Park Towne Place.
Park Towne Place
Aimco bought Park Towne in 2000. The four-building complex
at 2200 Benjamin Franklin Parkway has 973 apartments. It was constructed in
1959 and is an example of mid-century modern architecture. It did some minor
improvements to the complex in 2007. The property is fully occupied and that
poses its own complications in conducting extensive renovations to the
property, said Wes Powell, who is head of Aimco’s redevelopment efforts in
Philadelphia.
That said, this is a process Aimco has mastered and it
already set in motion at Park Towne recently when it upgraded the HVAC and fire
protection systems. Residents were moved to a hotel for a couple of weeks.
The goal, according to Powell, it to “reposition Park Towne
to where it was 50 years ago when it was near the top of the rental market in
Philadelphia.”
To that end, each unit will be totally gutted, re-configured
and everything from appliances and cabinets will be new in the kitchens and
bathrooms.
The corridors and common areas will be renovated and, as a
way of reconnecting to the neighborhood, rotating art installations as well as
original works of art will be displayed.
A swimming pool will also get upgraded and the pool area
will look to take on the feel of a resort. A three-season outdoor is also in
the works as well as a new fitness facility. Aimco is also in early discussions
to bring a restaurant to the building and is going through the zoning process
to do that. There is 28,000 square feet of retail space.
A three-acre park that fronts the complex as well as the
Parkway will be reactivated. It will have art, sculpture and areas to gather.
“I think we’re making some excellent improvements,” Powell
said.
Work will begin later this year.
The Sterling
Aimco bought the Sterling at 1815 John F. Kennedy Blvd. in
1999. Since then, that part of Philadelphia’s Central Business District has
changed with the construction of Comcast Center, extension of the concourse and
will continue to evolve with the addition of Comcast’s second skyscraper that
will sit next door.
The 19-story tower has 550 apartments, 23,000 square feet of
retail space and 93,000 square feet of office space. Built in 1961, it is also
an example of mid-century modern architecture. The apartments are fully
occupied.
“We’re excited about the potential with this one as well,”
Shwayder said.
The property underwent a moderate renovation in the 1990s
but other than that, it hasn’t been touched. Aimco has slightly opportunities
with the Sterling renovations, Powell said.
“It’s a true mixed-use building fronting JFK,” he said.
As with Park Towne, the apartments, which range from 850
square feet to 2,000 square feet, will be totally gutted. A roof-top pool and
sun deck that is now under utilized will be energized and a three-season space
will be created. The roof will also get an addition where a new workout
facility will be installed. The ground-level retail space will be repositioned
with new tenants, uses and storefronts. All common areas will be upgraded and
gathering spaces created.
“These are more than quick and easy renovations,” Powell said.
Work has recently started.
Source: Philadelphia
Business Journal
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