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Read the news of the day in less than 10 minutes — not that we’re counting.
Welcome to “What ever happened with,” Billy Penn’s ongoing series that will look at older stories that may have been forgotten about or otherwise not followed up on. Whether it’s a delayed development project or an unsolved murder mystery, “What ever happened with” strives to tell you what’s up with that Philly thing you might have forgotten about.
The redevelopment of the 120-year-old Divine Lorraine Hotel isn’t just about revitalizing a 10-story, dilapidated building. Developers, investors and the city hope renovating the hotel will be a catalyst for reviving the rest of the North Broad Street Corridor, especially above Ridge Avenue toward Girard.
Like anything else, it’s just a matter of time and money.
“Nobody in their right mind would have taken on this project, because it’s so challenging and difficult,” Philadelphia developer and owner of the building Eric Blumenfeld said. “I think that I look at things different, but that doesn’t make me the smartest guy in the world. I don’t look at things just on the economics of the project. I look at it based on the economics of the master plan.”
Blumenfeld, along with the support of investors and the city, hopes to turn the Divine Lorraine — which for years served as a kind of paradise for urban explorers — into a mixed-use complex. It’ll contain about 130 residential units on the upper floors and at least a couple of restaurants on the bottom two. But construction on the project has stalled several times, the developer and the city tell Billy Penn, because of difficulties securing funding and permits and permissions from the city.
Billy Procida, a real estate lender from Englewood Cliffs, N.J., agreed in May to lend upwards of $30 million to get the development project off the ground. His company, Procida Funding and Advisors, made an agreement with Blumenfeld’s, EB Realty Management, so both could move forward.
Blumenfeld told KYW Newsradio in July that he wanted to get construction going on the Divine Lorraine by September. Procida said it’s looking like construction will be pushed to spring. He said developers are hoping they’ll make some kind of an announcement “by January or February” that they’ve settled and then start construction after that.
“What’s taking so long is it’s one of the most challenging projects in the country,” he said. “When you get a building as architecturally distinct as that, it’s always very challenging.”
Blumenfeld bought the Divine Lorraine, which has 100,000 sq. ft. of interior space, in 2012 for $8 million — he’d actually bought it for the second time after he sold it off once before to another group of developers. Since then, his main focus has been securing around $50 million for renovations. He said last week that in addition to funding and support from lenders, the project was also awarded a $5 million state grant through the Redevelopment Assistance Capital Program.
The Divine Lorraine has been empty since 1999, and Mayor Michael Nutter once made a priority of redeveloping the hotel so that changes to the entire North Broad Street Corridor could be set in motion.
Jeremy Thomas, the director of real estate for the city Department of Commerce, has been working with Blumenfeld on the project since he took over, and believes redeveloping the Divine Lorraine is the key to setting property development in motion throughout the entire North Broad Street Corridor.
He said obtaining permissions from different departments takes a great deal of forward planning, and often holds up large projects. Because the Divine Lorraine is considered a national historic landmark, its developers are eligible for certain tax credits that amount to grants. But in order to obtain those, very specific plans to retain the historic architecture in the site must be submitted and approved.
As for the city, Thomas said developers have a lot of work to do in terms of figuring out how to complete the construction to code. They have to show the building is safe, and that the construction of the massive structure will be safe, too. To do that, the city facilitated meetings between Blumenfeld and different departments to discuss construction of the intricate, alabaster stairs, where the parking lots will be and more. Some of the seemingly smaller issues are still up in the air.
“We have been able to be supportive and say, ‘we’re going to do anything we can to move this along,’” Thomas said. “This is a big priority. We do want this to move forward as quickly as possible, and we’re hopeful they can close on the financing to do that.”
Blumenfeld says he’s dedicated to getting hammers and nails going soon. Once that begins, the focus will be in finding tenants for and opening the commercial spaces. Because of the extra land behind the Divine Lorraine in addition to a large annex building, Blumenfeld said planners hope to give the restaurants outdoor and indoor space for diners.
They’ll move onto developing the residential spaces on the upper floors — all the while, Blumenfeld says, attempting to pay homage to the hotel’s history.
And for Blumenfeld and Procida, the master plan is turning the North Broad Street Corridor into something completely different than it is today. Blumenfeld owns several other buildings in the area that he’s planning to redevelop into trendy restaurants. Little by little, the North Broad Street Corridor’s buildings are filling in.
In addition, last year Blumenfeld bought the Metropolitan Opera House just a few blocks up the street at 858 North Broad Street, the other iconic building in the corridor that’s seen better days. He said in 2012 that, “In the daytime it could be a museum… At night, a concert hall.”
For Procida and Blumenfeld, the Divine Lorraine sets all this in motion.
“I see the North Broad Corridor as basically exploding in the next cycle,” Procida said. “And once the Divine Lorraine’s developed, I think you will see that whole corridor between Temple and City Hall is just completely different.”
