Brandywine Realty Buys 108K SF Former Hahnemann Building For Under $10M
The real estate of the former Hahnemann University Hospital has finally begun selling.
An affiliate of Brandywine Realty Trust acquired the 13-story medical office building at 1501 Race St., also known as the Bellet Building, for $9.7M in October, according to CoStar data reported by the Philadelphia Inquirer. The sale has not yet appeared in the city of Philadelphia's property records.
The 108 SF Bellet Building was constructed in 1922 and sits on the outer edge of Hahnemann's campus, which is centered around North Broad Street one block to the east. Unlike most of Hahnemann's campus, the Bellet Building is still in use by Drexel University, the Inquirer reports.
The building most recently sold in 2018 for $5.7M as part of Tenet Healthcare Corp.'s sale of the entire Hahnemann campus to a partnership of Harrison Street Real Estate Capital and Paladin Healthcare, a private equity fund owned by Joel Freedman. Each entity took possession of certain individual buildings, all of which were leased to Philadelphia Academic Health System, also owned by Freedman.
Eighteen months after the sale, PAHS filed for bankruptcy and announced that Hahnemann would cease operations. (St. Christopher's Children's Hospital in North Philadelphia, which was also part of the Tenet sale, remains in operation.) Because PAHS was a separate entity, Harrison Street and Paladin retained ownership of Hahnemann's real estate, giving rise to speculation the closure was Freedman's plan from the beginning and making Freedman one of the least popular figures in Philadelphia.
The Bellet Building is one of six Hahnemann buildings that Harrison Street owned. The remaining five are being marketed for sale by JLL, the Philadelphia Business Journal reports. Hahnemann's real estate is ripe for redevelopment into space for life sciences companies, members of the Newmark team marketing the buildings owned by Paladin told PBJ, because it already has infrastructure for heavier and more complex usage than office buildings.
Brandywine is already repositioning part of its office portfolio in Philadelphia to life sciences use for Spark Therapeutics, which is expanding its footprint at Cira Centre even as it anchors the first portion of Brandywine's nearby Schuylkill Yards megaproject.