1700 Chestnut St. bought by Pearl Properties

Pearl Properties bought 1700 Chestnut St., an 8-story building that now houses Nordstrom Rack as a retail tenant.

The acquisition expands the Philadelphia real estate company's presence along the corridor. Chestnut Street has a mix of residential and retail spaces as well as an increasing amount of new ground-up development underway that is helping to recast the street and its place as a destination in Center City.

Pearl owns six properties stretching from 1600 Chestnut all the way to 1912-18 Chestnut. The company specializes in mixed-use buildings that have retail on the lower floors and residential on top.

The purchase of 1700 Chestnut will be no different. With Nordstrom Rack already locked in to approximately 40,000 square feet on the first three floors, Pearl plans to develop the top five floors into apartments, according to sources. There is a separate entrance off of 17th Street that will give residents access to that space.

The property has long been known for its former retail tenant — Daffy's.

JEMB Realty Corp., a New York real estate company, bought 1700 Chestnut two years ago when it entered into an agreement to buy Daffy's leasehold interests and other affiliated entities including three real estate properties. At the time, Daffy's was being liquidated through bankruptcy.

The building in Center City has roughly 10,000 square feet per floor.

Terms of the transaction with Pearl couldn't be confirmed. Jim Galbally of JLL arranged the transaction.

Another sale is expected along the corridor. The four-story building at 1608 Chestnut, occupied by Uniqlo, is reportedly set to trade for in excess of $20 million.

Source: Philadelphia Business Journal