Investment Launches Redevelopment of Historic Landmark to Luxury Apartment Tower
Federal Capital Partners (FCP) announced that it has provided $7.5 million in mezzanine debt to 1701 Arch Partners LLC to fund the redevelopment and construction of the Robert Morris Building at 1701 Arch Street, a 14-story, 111-unit luxury apartment building in downtown Philadelphia, PA. The investment marks FCP’s first investment in the Philadelphia market.
“FCP is aggressively pursuing debt, mezzanine and equity investments in the Philadelphia region,” said FCP Managing Partner, Lacy Rice. “We are excited about the opportunity to work with Philadelphia-based 806 Capital to transform the majestic but long-neglected Robert Morris building into one of downtown Philadelphia’s premier boutique apartment residences.”
The landmark Robert Morris Building is flanked by Comcast’s recently completed headquarters and the Bell Atlantic Tower. The building is minutes from some of the finest amenities in downtown Philadelphia, including Rittenhouse Square and Reading Terminal Market. The building, which was built in 1914, originally served as an office building and subsequently as a hotel. It has been slated for redevelopment since 1701 Arch Partners LLC purchased and gutted the building in July of 2007. Plans for redevelopment include renovating the retail streetscape, reconditioning the terracotta façade and replacing windows. The building interior will be completely rebuilt to include 111 luxury apartments, a media center, an exercise room and other Class-A tenant amenities.
FCP will oversee the renovation and management of the asset with DC-based TPSi retained as construction manager. FCP engaged Walker & Dunlop, who procured a $16 million dollar senior construction loan from PNC Bank, N.A. PNC Investment Company, LLC, an affiliate of PNC Bank, also made a $7.4 million historic tax credit equity investment in the venture.
About Federal Capital Partners
Federal Capital Partners (FCP) is a Washington, DC based, privately held real estate investment company that has acquired interests in more than $2 billion in assets since 2003. FCP invests in residential and commercial assets throughout the Mid-Atlantic region, including Washington, DC, Baltimore, Philadelphia, the Virginia Tidewater region and the Raleigh/Durham area. Over the past two years, FCP has been one of the most active investors in the Washington region, amassing more than $1 billion in real estate assets. FCP’s managing partners are Tom Carr, Esko Korhonen, Alex Marshall and Lacy Rice.
Through its discretionary co-mingled private equity funds, FCP invests directly in core plus, value-add, opportunistic and development properties. In addition, FCP provides both equity and debt capital to real estate operating partners and is aggressively seeking office, residential (for sale and for rent), industrial and retail investments in all of its target markets.