Rittenhouse Hill, a 624-unit apartment complex nestled in a grove of trees at the edge of the Wissahickon Park in Germantown, will be transformed in luxury apartments as developers Post Commercial Real Estate have raised $52 million to jumpstart the work.
Michael Pestronk, president of Post Brothers, is one half of the development duo which owns the 470,000 square foot complex located at 633 W. Rittenhouse St.
He said a “total gut job” ensued in 2010 when they purchased the old Empirian Luxury Towers at short sale for $27.3 million through an affiliate corporation, buying out the $50 million mortgage.
As a result, rents will jump from a projected $600-700 to around $1,300. Pestronk said Tuesday that their first impression was not pretty, and attributes the rent hike to the extensive, and necessary, renovations.
“We found people sleeping in the stairwells. The fire alarm system didn’t function. Everything about the building was physically tired,” he said of the towers built in 1955. “We’re gut-renovating it 100 percent. Everything you see including the walls will be new.”
Other projects in the Northwest
Michael and his brother Matthew, both originally from Washington D.C., also own and operate Clovery Park and Copely Manor in West Mt. Airy, Pastorius Court in East Falls and Delmar Apartments located at the corner of Morris and W. Chelten Ave. in Germantown.
“We were looking to develop apartment buildings in areas where desire for apartments to live was high, but the existing real estate was available and inexpensive,” said Pestronk, drawing a contrast to saturated markets in University City, the Main Line and Center City.
The brothers recently secured a $52 million loan through an undisclosed European bank. That was arranged by Ackman-Ziff Real Estate Group, where Matthew is a managing director.
When the new complex opens in 2014, it will be “fully contained” with a 24-hour service desk, security, gym, an “infinity edge swimming pool” and wellness providers in the first-floor retail spaces. A trail to connect the property to nearby Wissahickon Gorge in Fairmount Park is also in the plans, the developer said.
Dissention at the site
The news of a project which will create an estimated 200 construction and other jobs – with 25 permanent positions – doesn’t come without a controversial edge, though. Construction labor unions have been picketing and protesting what they view as the use of low-wage, non-union labor.
Pestronk, whose project is not using public money, claimed, “They follow me to my car, to my home, even my wife. It’s a form of intimidation.”
He continued that the protestors are from the suburbs while more than 60 percent of his workforce lives locally and 70 percent are minority hires.
“These guys are picketing while we’re employing Philadelphia county residents on the inside,” he said.