Banks, pension funds, taxpayers kick in for Chestnut St. tower

"Signs of life in Center City construction:

Chicago investor John A. Buck and leaders of the union-backed Indure Fund stood under a tent and ceremonially shoveled dirt Thursday to start work on their long-planned 319-apartment tower (plus shops and a parking garage) soon to rise at 2116 Chestnut St.

Buck and Indure, a fund backed by the International Brotherhood of Electrical Workers and the National Electrical Contractors' Association's joint labor-management pension fund, each pledged to invest $20 million in the $100 million tower.

Banks led by JPMorgan Chase & Co. are lending Buck and Indure the other $60 million, and Pennsylvania taxpayers will give the investors a $10 million grant when the job is done, in a move approved by Gov. Corbett and his predecessor, Ed Rendell. They needed taxpayer sweeteners, the investors said, because Philadelphia's relatively low rents, combined with its East Coast building costs, don't guarantee an attractive profit margin.

Buck, a Wharton School graduate who founded John A. Buck Co. in 1981, said the tower would be his first development in Philadelphia, and he thanked political leaders for the people's millions: "I love Philadelphia. It's good to be back here. Philadelphia has more of a residential and warm feeling to it than our great city" of Chicago.

"We've been looking for a Philadelphia project with John Buck Co. for years; there was never anything that made sense before," said Jeffrey J. Kanne, president of Indure's advisory group. Up to 800 workers will be active on the job site between now and its scheduled 2013 completion, he said.

Kanne told Mayor Nutter and City Councilmen Bobby Henon and Kenyatta Johnson that Indure was also looking for government help to revitalize dowdy Girard Square, between 11th and 12th and Market and Chestnut Streets. Indure is working with Peter Soens to redevelop the block under a 75-year, $90 million lease with the city-run Girard Trust, which has cited lower investment profits in cutting services to low-income students at Girard College.

Soens and Indure have big plans for the Girard block: They want to lure a Target-style discount store or Giant-style grocery store, a hotel, and an apartment developer. But "that depends on getting money" from the city or another government entity, Kanne said.

Separately, tenants are being sought for yet another Center City apartments-and-retail project, on Brandywine Realty Trust's grass-covered block at 1919 Market St., next to Independence Blue Cross headquarters."
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