Cash-strapped archdiocese sees high-rise towers for cathedral campus

The proposed campus around the Cathedral Basilica of SS. Peter and Paul would include high-rise buildings, gardens, and walkways, as in this rendering.

The Archdiocese of Philadelphia envisions hundreds of new dwellings - including one for the archbishop - around its Center City cathedral.

The new housing is part of an ambitious proposal to transform acres of underused land around the historic Cathedral Basilica of SS. Peter & Paul into an inviting enclave of high-rise buildings, verdant gardens, and pedestrian walkways.

The plan, if successful, would be the archdiocese's highest-profile move yet in a years-long effort to bolster its finances, largely through property sales, amid flagging church attendance.

But at the cathedral campus, the archdiocese also is hunkering down while it cashes in, with plans to upgrade its own office and ecclesiastical space there and to move its archbishop in from the city's edge for the first time since the 1930s.

"The cathedral itself is the mother church of the whole archdiocese," Deacon Thomas Croke, director of property services for the archdiocese, said in an interview Wednesday. "We're not likely to give it up too quickly."

Since Archbishop Charles Chaput's appointment to lead the archdiocese in 2011, it has closed on about $91 million in real estate sales to help plug gaping holes in its budget, Croke said.

Transactions have included the $10 million sale of the mansion property on City Avenue that had long been home to Philadelphia's archbishops. Additional assets such as church buildings, schools, and convents, meanwhile, have been sold to replenish the coffers of individual parishes regionwide.

Across the United States, dioceses are taking advantage of hot property markets by selling off excess real estate holdings. Archdiocese of Chicago officials, for example, recently began marketing a property now used for parking across from that city's Holy Name Cathedral.

Deals involving religious properties of all denominations reached $1.5 billion last year, up from $690 million in 2011, according to real estate research firm CoStar Group.

Catholic dioceses and other religious organizations are turning to property sales to make up for shortfalls in traditional income sources, such as school tuition and offerings during services, said James Hudnut-Beumler, a professor of history and divinity at Vanderbilt University in Nashville.

"What we're seeing now is a need to get more creative about finances because of the changing financial and institutional fortunes of organized Christianity in the second decade of the 21st century," Hudnut-Beumler said.

The Philadelphia Archdiocese's current proposal is its second recent attempt to profit from the land around the cathedral, now an expanse of parking lots and underutilized buildings near what is becoming one of Center City's most vibrant residential neighborhoods.

Previous negotiations to sell part of the 4-acre campus to developer Greystar for a residential project fizzled in 2013 over disagreements surrounding archdiocesan input on building design and access to parking, Croke said.

This time, officials anticipate extending a 99-year lease to a developer for a 2.2-acre, L-shaped parcel running to the north and east of the 1864 cathedral, according to a presentation this week to the Logan Square Neighborhood Association, which has jurisdiction over the site.

No revenue targets have been set for the ground-lease deal, in which the archdiocese would retain ownership, and no developers have yet been approached about the opportunity, Croke said.

It's difficult to estimate how much the archdiocese might earn from such a real estate deal because few similar ground-lease transactions have been executed in the immediate area, according to Lauren Gilchrist, Philadelphia research director at commercial real estate services firm JLL.

Early conceptual plans call for the demolition of the three 20th-century buildings on the proposed development site to make way for two mostly residential high-rises along landscaped paths.

The new building to the north, which appears as a 44-story tower in renderings presented to the neighborhood group, would feature ground-floor retail and restaurant space.

The second tower to the east, presented as a 33-story building, would accommodate on its lower floors administrative offices that are currently housed in a campus headquarters building Croke said is in need of millions of dollars of maintenance.

Also in that new building, the use of which would be guaranteed to the archdiocese as part of the ground-lease negotiations, would be the cathedral's convent and social-service annex, both now located in structures also proposed for demolition.

Another component of the plan is the reestablishment of the campus' rectory, south of the cathedral, as the archbishop's residence for the first time since 1935, when Cardinal Dennis Dougherty moved into the then-new City Avenue mansion.

Chaput has been living at St. Charles Borromeo Seminary in Wynnewood since the mansion property was sold to St. Joseph's University in 2011, but he has expressed a desire to live beside the cathedral, according to Croke.

"It's his church," Croke said. "He wants to live here, as well."

The plan also calls for 200 underground parking spaces, to replace spots for archdiocesan use lost to development, and at least 200 additional underground spaces for residents of the new buildings, Croke said.

Archdiocesan spokesman Kenneth Gavin said it was too early to comment on whether developers would be required, as ground-lease conditions, to locate parking underground or to include features such as ground-level retail, citing the conceptual nature of the current plans.

As a first step, the archdiocese is seeking the neighborhood association's support for a zoning change needed for the project to advance.

Drew Murray, Logan Square Neighborhood Association president, said that the group's board reacted positively to the proposal, but that it won't back a zoning change until it is assured that members will continue to have input on the plans as they progress.

Hudnut-Beumler, the Vanderbilt professor, said the Philadelphia Archdiocese is being canny by leveraging its attractively situated real estate to finance facility upgrades it could ill afford on its own.

"This might be a case of following Jesus' admonition in the Gospels to be as wise as serpents and as innocent as doves," he said. "To let the market build the building for you so you can go ahead and do the innocent work of ministry."

jadelman@phillynews.com

215-854-2615 @jacobadelman

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