Few tenants moving into Philadelphia's Center City offices

"Philadelphia's Center City office vacancy rate has topped 15 percent, the worst since 2004. That's up from less than 10 percent just two years ago.

"There's been a period of stagnation," with few tenants moving in as the economy slows.

Philadelphia's chemical industry has been pulling out: Arkema Inc. is consolidating its Center City offices at its King of Prussia labs. Sunoco Inc. is trying to sublet its headquarters as it sells off businesses and cuts staff. And Dow Chemical Co. has vacated parts of the landmark former Rohm & Haas Co. building on Independence Mall since it bought the firm last year.

Brandywine Realty Trust's $129 million purchase of the former Bell Atlantic building in a stock deal with Blackstone Group L.P. earlier this month "changes the dynamics of the market." Though national real estate values had fallen about 40 percent, building owners had mostly resisted cutting deals at lower prices, in hopes the market would recover. The surrender could spark more low-price deals - enabling buyers to cut rents and still turn a profit.

Brandywine will try to keep rents above $30 per square foot on the upper floors, but may accept less if it can rent larger blocks of space on the lower floors to big law firms looking for high-rise space as their old leases expire.

At least one corporate employer is still expanding. Comcast Corp. has sublet the 42d and 43d floors of the Bell Atlantic tower - a longtime hub for Comcast's rival, Bell Atlantic successor Verizon Communications Inc. - after the space was vacated by Aramark Corp., the Philadelphia-based food-service giant.

Aramark has been consolidating its workforce operations to its Market East headquarters and other existing Center City space, said spokeswoman Kristine Grow."