In a deal that could have wide ramifications for Philadelphia, the Preservation Alliance has dropped its legal opposition to demolishing two landmarked church buildings in West Philadelphia after the property's developer agreed to create a fund to preserve the main church, the Episcopal Cathedral.

The proposed demolition of the two brownstones to make way for a 25-story apartment tower provoked an outcry among preservationists because the properties were listed on both the city and national historic registers. Citing the public interest, however, the Historical Commission revoked the landmark status in June, spurring the alliance's appeal.

The settlement, announced Wednesday, allows the Radnor Property Group to proceed immediately with construction of the tower at 38th and Chestnut Streets. The 280-unit project will replace the rectory and parish house as well as a small apartment building.

Alliance chairman Marian A. Kornilowicz said the group was torn between sacrificing the brownstones and securing the future of the more significant cathedral, designed by architect Samuel Sloan and reconstructed by Charles M. Burns.

"It was a very tactical, utilitarian thing to do," he said, adding that Philadelphia is losing historic religious buildings at a record rate. He added that the alliance "continues to have reservations about what the Historical Commission did."

The commission's ruling on the parish houses was the third time in the last two years it has revoked the certification of a landmarked building because of financial issues. Preservationists continue to battle in court to save the other two condemned properties, the Church of the Assumption on Spring Garden Street and a mansion at 40th and Pine Streets also designed by Sloan.

Under the settlement, Kornilowicz said, Radnor Property must donate more than $2 million immediately for restoration of the cathedral. It also agreed to contribute $1.3 million more during the next several years to a maintenance fund.

As a result, Kornilowicz said, the Episcopal Diocese of Pennsylvania has pledged to keep the cathedral open for the next 50 years. To rebuild its congregation, it plans to open a day-care center in the basement that will be able to accommodate 110 children.

The case brought together two of the most difficult preservation issues facing Philadelphia. The city has an immense inventory of historic religious buildings - nearly 1,000 by some counts - but changing habits have made it difficult for many to keep their doors open. Once they close, they are often left to crumble.

Partly because of such challenges, the commission has become increasingly willing to relax its rules to encourage redevelopment. Just last week, staff director Jon Farnham put forward a proposal to change the bylaws to make it more difficult to challenge its decisions on financial hardship.

In the Episcopal case, Kornilowicz argued that the commission should have been the one to work out the compensation deal. "They left it completely vague," he said.

The Episcopal Cathedral has been in trouble for years. In 2002, it gutted its sanctuary's ornate interior and replaced it with a modern design in the hope of luring more parishioners. After that failed, it made the deal to develop the land occupied by its parish house.

The site was immensely desirable, said Radnor Property president David Yeager, because it is only a block from the University of Pennsylvania campus and hospital complex. The tower, designed by BLT Architects, will be marketed to graduate students and people working at the university.

The high-rise is the latest in a parade of residential towers along Chestnut and Market Street in West Philadelphia attempting to appeal to those groups.

In January, Brandywine Realty Trust began construction of a 36-story tower by Erdy McHenry at 30th Street and Chestnut. The Science Center wants to build a high-rise at 36th Street and Market. And American Campus Communities is finishing a new apartment building for Drexel University at 33d Street and Chestnut.

Contact Inga Saffron at, 215-854-2213 or on Twitter @ingasaffron.