After the acquisition of this asset in 2008, APF Properties initiated a strategic repositioning program (“From Tired to First-Tier,”) to establish 1601 Market Street as a notch above its competitors as opposed to being a notch below when APF purchased this tired asset.
In 2010, significant efforts were employed to retrofit all building systems, upgrade building services and obtain the first LEED Certification for Existing Buildings in the Philadelphia market. These efforts were instrumental in retaining KPMG as an anchor tenant. At the end of 2011, the building converted 14,000 SF of basement storage and building space by signing a lease with a first class child care provider, Bright Horizons, adding almost $250,000 to the bottom line.
In 2014, ownership completed a new retail development within the footprint of the building adding 7,000 SF retail space on the ground floor and 8,000 SF of dramatic 19 foot ceiling unique office space on the second floor. The new transparent glass façade has repositioned 1601 Market Street with a visually highly attractive street presence. In 2015, the building was able to upgrade its LEED certification level to Silver and has also obtained the Wired Certified Silver designation for buildings well suited for modern technology.
As an outcome of all these value adding steps, 1601 Market Street has been elevated to Class A+ status with gross rents far exceeding market comparables. The net operating income increased from $5.6 million in 2007 to a projected $9.5 million in 2016 – a 70% increase!