Natalie Kostelni Reporter
Yet another property will be turned from office space to apartments. Alterra Property Group has acquired Chestnut Place, a 17-story, 141,630-square-foot office building at 42 S. 15th St. in Center City, and has plans to convert it into apartments. The company, run by Leo Addimando, has bought other Center City office buildings with an eye toward turning them into residential use. For example, Alterra was part of a partnership that bought 1616 Walnut St. last year and relocated 100 of its office tenants that occupied the space and launched a conversion. When completed, that 25-story, 279,770-square-foot building will have 206 apartments.
Alterra bought Chestnut Place from SSH Real Estate, a Philadelphia company run by Pete Soens and Jeff Seligsohn, for $17.5 million. The SSH partnership bought the building in 2005 for $11.38 million. Alterra intends to convert Chestnut Place into 175 apartments. It is occupied by about 25 small tenants including non-profits, educational and law firms that like its proximity across from City Hall. It has several street-level retail tenants including Dunkin’ Donuts and Wendy’s.
Alterra was attracted to the building because of its central location. “It’s the dead center of the city,” said Leo Addimando of Alterra. “It’s close to public transit, walking distance to teaching hospitals, easy to get to all jobs and classrooms and other things that draw people to live in the city. We’re really excited about the potential of the building to be revitalized into a nice, upscale rental apartment project.” The target renter is a young professional and graduated student. Other residential properties in that area include the Residences at Ritz Carlton and Two Liberty Place.
Relocating tenants and completing the project will take a couple of years. In that time, Alterra expects to figure out what it intends to do with the retail space. “We don’t have any concrete plans on the ground floor yet,” Addimando said.
Natalie Kostelni covers real estate and economic development.