Penn gets postal lands

After years of anticipation, it's finally happened.

Penn announced today that it had closed on its purchase of the postal lands east of campus.

It will collaborate with Brandywine Realty Trust on development of the area between Market and Walnut streets, which will feature a 40- to 50-story office tower on Walnut Street and a 25- to 30-story residential tower on Chestnut Street.

The University has also sold the post office to Brandywine for $28 million, which has been leased to the Internal Revenue Service for 20 years and will house 5,000 IRS workers, who will be relocated from offices in Northeast Philadelphia, according to an IRS spokesman.

The postal service will lease space from Brandywine until the end of next year - most of the staff at the 30th Street post office have already moved to a new processing facility in Southwest Philadelphia, which opened last year.

The office and residential towers will be constructed by Brandywine on land leased from Penn for 90 years and will be on space currently occupied by the Post Office Annex, which will be torn down.

The Brandywine Development, which will be known as Cira Centre South after the Cira Centre - also built by Brandywine a few blocks north near 30th Street Station - 400-500,000 square feet of office, street level retail, hotel and residential space.

Penn has agreed to lease about 100,000 square feet of that for 30 years.

Though it's not known yet how much this development will cost, it will cost about $110 million for a 2,400 space parking structure that will be adjacent to the development.

Construction on this area is expected to begin during the first quarter of next year and is scheduled for completion by mid-2010.

The area south of Walnut Street will be retained by the University and consists of 14 acres of parking lots that will be replaced by recreational and athletic space, as well as academic, cultural, commercial and residential buildings and a pedestrian bridge along Locust Walk through to Center City.

Construction on that parcel of land is scheduled to begin after an October kickoff to a major fundraising drive to fund the development.

In a statement, Penn President Amy Gutmann said that the project will "stimulate economic development, improve the urban infrastructure and character of University City, bridge the divide between the campus and Center City and create a vital new center of commerce for the region."

Gov. Ed Rendell and Mayor John Street also praised the development in a statement.

Brandywine officials could not immediately be reached for comment.

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