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The Beury Building on North Broad Street has been empty for 50 years. And the community still has to wait for economic development – at the end of last year, a major lender who had promised a loan to a property developer unexpectedly withdrew.
Once known as the National Bank of North Philadelphia, the historic building is located near the commercial intersection of Broad Street, Germantown and Erie Avenue. For decades, however, it has been nothing more than a graffiti-covered shell. About 12 years ago, the building was purchased by Shift Capital, a purpose-built developer with big plans to breathe new life into it.
“The large number of vacant properties at such a prominent intersection make any economic development difficult,” says Nancy Gephart, managing director of Shift Capital.
Shift Capital knew it was a risky venture, so the $70 million hotel conversion was rewarded with historic preservation and new market tax credits and a $2 million grant from the Pennsylvania Redevelopment Assistance Capital Program. The property-rated clean energy model known as C-PACE and Shift Capital also contributed equity to the project. About four years ago, the developer secured all the financing it needed to make the 172-room Marriott hotel a reality, including a local hotel operator, the Wankawala Organization, as a partner. Marriott as a chain even donated $2.5 million.
Then the COVID-19 pandemic started and the whole deal fell through. A few years later, the developer again put together a financing package and began construction, completing about $6 million worth of environmental remediation and stabilization of the Beury building. Still, a lender that had promised a $23 million loan unexpectedly backed out, which Gephart said derailed the entire project. That means Shift Capital still can’t quite keep its promises to the community — it signed a community benefit agreement that would have employed local residents and secured contracting to minority-owned businesses for two projects.
“The community groups are really excited about the project,” Gephart said, adding that the situation “has simply forced us to put the project on hold. There is no way we are going to give up on this project.”
