The potential redevelopment of Centre Square, Philadelphia’s largest office property, took a step forward Monday with a new court ruling.
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The $70M sale of the property to affiliates of Dean Adler and PMC Property Group was approved and directed by U.S. District Court Judge Nitza Quiñones Alejandro ahead of an Oct. 16 deadline for the transaction, the Philadelphia Business Journal reported.
The future of the 2.2M SF office complex spanning two towers at 1500 Market St. has been up in the air since foreclosure proceedings began in 2023.
In March, Adler and PMC went under contract with court-appointed receiver CBRE to buy the property with plans for a partial mixed-use redevelopment including apartments and a hotel.
But later that month, new uncertainty was injected into the transaction when CSC Coliving and Universal Group Co. challenged the sale, claiming they had filed higher bids.
CSC Coliving eventually withdrew its challenge. That was followed by Adler and PMC’s effort to get out of the sale despite a $5M nonrefundable deposit.
“I got to find out if there’s something we missed,” Adler told The Philadelphia Inquirer in July. “Maybe they found something that we didn’t know, so we have to go back to do more homework.”
But Alejandro wrote in her Monday decision that “there is no just reason for delay in the entry of this Order and that this Order is final immediately for purposes of appeal,” the PBJ reported.
The $70M sale price Adler and PMC agreed to is 21% of what Nightingale Properties and InterVest Capital Partners purchased Centre Square for in 2017.
That joint venture refinanced the property with a $390M loan from JPMorgan Chase two years later before they ultimately stopped making payments.
Occupancy in the complex overlooking Philadelphia City Hall was just 36% when CBRE listed it for sale as a potential conversion play last August after the pandemic cratered Center City’s office market.
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