East Market Inks Design Center, Closes $38.5M Construction Loan
Things are really rolling at the East Market project at 11th and Market, specifically inside the building at 34 South 11th Street. National Real Estate Development and SSH Real Estate announced yesterday that they’ve inked a deal with the Design Center, a major resource for interior design professionals throughout the region, to lease 48,000-square-feet of space over two floors inside what was the Family Court building.
The group also announced that they have secured a $38.5 million construction loan with Wells Fargo to “fund the continued renovation” of 34 South 11th Street.
This news follows on the heels that MOM’s Organic Market will anchor the ground floor retail space at the site and, according to the press release, the Design Center is already looking to grow:
“The showrooms will temporarily move to 15th Street and Juniper Street this month, and will open at East Market in the fall of 2016. The Design Center also has the opportunity to expand into an additional 24,000 square feet as the business grows. And that is their plan. “
The future for some of the showrooms left at the Design Center, formerly knowns as the Marketplace Design Center, had been up in the air recently. PMC Property Group and Lubert-Adler have partnered to redevelop their current home at 2400 Market Street into a mixed-use project featuring residential units and office and retail space. So, it comes as no surprise to hear that the independent business owners that make up the new Design Center are excited about the deal:
“In selecting a new location for The Design Center showrooms, we knew it was critical to find a place with an energy and creativity that fit our business,” said Lisa Kravet, vice president of Kravet, in the press release. “East Market is already a dynamic urban environment, and with this move, each showroom has the opportunity to be part of a completely new Philadelphia experience. We needed a new space that was highly visible, customizable and offered room for growth, and we are thrilled to have found that within East Market.”
Nine companies will eventually make the leap across Broad Street to East Market, including The Baer Collection, Beatrice & Martin, Croce, AK & CO, Harrington Group, Kravet, Pindler & Pindler, Robert Allen and Scalamandre.
“The overall vision is coming to life,” said Dan Killinger, managing director of National Real Estate Development and development director for East Market. Killinger mentioned that they were developing “something really unique” at 34 South 11th Street, and than the overlap of a co-working, tech and entrepreneurial atmosphere “makes it a natural fit for the Design Center to be here … we’re excited to have them be apart of our project.”
In April, we learned that National and SSH tapped Morris Adjmi to re-skin the building at 34 South 11th Street with a contemporary facade and BLT Architects to design the interior spaces. Peter Soens, partner at SSH, told us at the time that the group was marketing 160,000-square-feet of Class A office space designed to bring the boutique warehouse vibes (open floor plans, floor-to-ceiling windows, tall ceiling heights, etc.) usually seen in Center City’s outlying neighborhoods into the heart of Midtown Village, a place that’s quickly becoming a major tech scene in Philly. We got a peek at its “great bones” during a construction tour in July.
Soens said today that the Design Center will initially takes floors 3 and 4, which leaves floors 2 and 5 through 8 up for grabs. SSH is still in negotiations with “other design-related tenants,” according to Soens, some of whom have either outgrown their space in Midtown Village or are seeking to get in on the action east of Broad Street, as was the case with the Design Center. “High-end tenants like [the Design Center] will only help that momentum kind of snowball now,” said Soens.
Speaking of the momentum on Market East, Killinger said they’re “very active” on the retail spaces on the Market Street and Ludlow Street sides of the project and anticipates announcing the first retailers there in the fall.
You may recall that the project breaks up the superblock that was once Girard Square into a more neighborhood, pedestrian-friendly experience. A new promenade called Chestnut Walk will run north/south through the project and be lined with retail and restaurants. Both Ludlow Street and Clover Street will be re-opened to traffic, and Killinger said that there will be restaurants in the back of the Stephen Girard Building and also 34 South 11th Street.
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