A New York investor has paid $5.34 million for 1617 Walnut St., a 7,000 SF, two-story building in the center of Philadelphia’s High Street retail corridor. While the building has been vacant for the last roughly five years, the new owner secured a tenant, Free People, to lease the space.
A New York investor has paid $5.34 million for 1617 Walnut St., a two-story building in the center of Philadelphia’s High Street retail corridor.
The nearly 7,000-square-foot building was put up for sale in late 2019 by a local family who had it in a trust and listed for $7.5 million. The price that it ended up selling for is a reflection of how the pandemic has affected real estate and the building, which has been vacant for the last roughly five years but the new owner did secure a tenant, Free People, to lease the space.
“The market was much different then,” said Ken Mallin of MPN Realty Inc., which sold the building along with colleague Veronica Blum. “2019 was a very good year for real estate and then the pandemic hit. What ever I was working on, went away. It suffered like other real estate during the pandemic and there had to be a price adjustment.”
It was marketed for its potential for development as well as prime retail space along Walnut Street. The property is zoned CMX-5, which allows for dense development and additional stories to be constructed atop of the structure. The building was designed by Seeburger & Rabenold and built in 1921.
Mallin declined to disclose the name of the buyer but said it’s a real estate investor who owns property in Manhattan, Miami, Los Angeles and is expanding into Philadelphia.
“The more difficult the New York market becomes the more interesting the Philadelphia market becomes,” Mallin said. “It’s easy and convenient. Every person I deal with from New York likes Philadelphia. The population is expanding each year, our retail didn’t suffer as much and it’s a stable environment here.”
The building at 1617 Walnut has stood vacant after Jack Wills, a British retailer, closed its store that had occupied the space. Though the space was vacant at the time of the sale, the new owner has landed Free People, an Urban Outfitters brand, to backfill the space, according to market sources. Mallin declined to comment on the tenant.
Free People has a store next door at 1625 Walnut St., which it closed and indicated that it will reopen soon at a new location. The building at 1617 Walnut allows it to double the amount of square footage it now occupies.
While New Yorkers have acquired real estate in Philadelphia over the years, that trend picked up in earnest around 2019. That’s when two of New York’s storied real estate firms, Durst Organization and Silverstein Cos., decided to invest hundreds of millions of dollars in the market and make a commitment to the city. It has continued ever since.
