A private developer who submitted the highest bid for a former University of the Arts building will win the auction despite the objections of a nonprofit and the Pennsylvania Attorney General’s Office, a judge ruled earlier this week.
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Quadro Bay LLC offered $2.71M for Arts Bank Building at 601 S. Broad St. after the college suddenly shut down and filed for bankruptcy last year. It is considering redeveloping the space for residential and commercial uses, The Philadelphia Inquirer reported.
The Lantern Theater Co. submitted a $2.61M offer for the property. The nonprofit and the AG's office argued that this bid should prevail due to a grant UArts received from the William Penn Foundation to renovate the building in the 1990s. It reportedly stipulated that the historic theater be used for charitable purposes.
But a Delaware bankruptcy judge decided otherwise during a hearing on Wednesday covered by the Inquirer.
“I am profoundly sympathetic to the desire of the commonwealth and the Lantern Theater and the many parties that took the time to either attend yesterday’s trial or write letters to the court to convey the importance of the Avenue of the Arts to the cultural life of Philadelphia,” Judge Brendan Shannon said.
“But the record developed at trial [held on Wednesday] makes it clear that neither bankruptcy code nor Pennsylvania law operate in this instance to permit me to substitute my judgment for the [UArts bankruptcy] trustee’s.”
Shannon said the trustee “is required to liquidate estate property promptly and efficiently to maximize returns to creditors, and that is what he has done here.”
Lantern was “deeply disappointed” with the ruling, the nonprofit told WHYY in a statement.
“The loss of the Arts Bank will be a blow to the performing arts in Philadelphia and for the Avenue of the Arts,” the organization said.
The building is one of nine that went up for auction after the university closed its doors in June 2024.
Two have already been sold. The Curtis Institute of Music bought the Art Alliance building at 251 S. 18th St. for $7.6M, and Temple University purchased Terra Hall at 211 S. Broad St., the largest structure in the portfolio, for $18M.
The nine properties were estimated to be worth a collective $87M when they officially hit the market in November. JLL is handling the listing.
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