Selling of vacant schools is underway
The School District is counting on $11 million in revenues this school year from properties it has put on the market.
by Benjamin Herold for NewsWorks, a Notebook news Partner
With dozens of new school closings looming, the School District of Philadelphia has started selling off some of its properties that are already vacant.
Three building sales were approved by the School Reform Commission in November: the former Walton and Muhr elementary schools in North Philadelphia and Jones Annex in Kensington.
More deals are anticipated, including the sale of the historic former home of West Philadelphia High. On Nov. 10, the District hosted a community forum at which representatives from New York-based Strong Place Partners said they intended to purchase the 250,000-square-foot school building at 47th and Walnut Streets and convert it into a mix of retail and loft apartments. City Councilwoman Jannie Blackwell of West Philadelphia had said earlier that the District was deciding between two offers from private developers interested in the facility.
“It will probably sell for $6 million, and one estimate said it would cost $38 million just to rehab,” Blackwell said.
This year’s District budget counts on $11 million in revenue from the sale of surplus properties.
Danielle Floyd, the District’s deputy for strategic initiatives, said that the market for old school buildings in Philadelphia overall has been surprisingly robust.
“We’re encouraged,” she said.
The first three deals, however, did not bring in big money. Combined net proceeds will be less than $700,000.
Floyd said the District had received solid offers for “a majority” of the 12 properties it put on the market in February. Five of the properties not yet sold, including West, have price tags over $1 million. Interest in some properties, including a vacant administrative building in Queen Village, has been intense, according to multiple sources.
The District is working with outside real estate brokers, whom Floyd described as helpful in getting potential buyers to look beneath the scarred exteriors of some of the buildings.
“When we look at them, we see potential,” Floyd said. “It was clearly something that added value and had meaning in the community, and it can be that again with the right group of people.”
The bids that have come in thus far are primarily from private developers and charter schools, Floyd said. KIPP Philadelphia was a co-purchaser of the Walton building. Jones Annex was sold to Elm City Capital and Richmond Mills LP, and Muhr went to Philadelphia Suburban Development Corp.
For each property it sells, the District sheds the $40,000-$50,000 annual cost of maintaining a vacant building.
Floyd said that money is just one of several factors the District is considering.
Officials also want to make sure that buildings go to buyers with solid financial backing, a strong track record, a quick timeline, and a plan that makes sense for the surrounding neighborhood. Ensuring that buildings don’t sit vacant for extended periods is a priority.
“The safety concerns and blight that [long-term vacancies] present to a community is a concern the District shares,” Floyd said. “We want to see these properties put back in use.”
In June 2011, the School Reform Commission adopted a new “adaptive reuse policy” to guide the disposition of surplus properties.
Blackwell, who said she’s been involved in the District’s effort to sell West “at every step of the way,” praised their approach.
The District empaneled seven “RFP evaluation teams” across the city to vet proposals from interested buyers.
School officials declined to identify the members of those teams, saying only that they consist of District staff, elected officials, city planners, and community representatives invited by the District.
Floyd defended the secrecy as necessary for any competitive bidding processes.
But some residents in West Philadelphia and elsewhere have criticized the lack of wider public input in deciding the future of major public assets.
Ultimately, the School Reform Commission decides which buyer gets any District property.
At properties that have not received any interest, the District will keep trying to generate offers, said Floyd. If no proposals materialize, the District could partner with the city to turn the parcels into green space.
With dozens more closings planned, the District is banking on $28 million in revenue from the sale of surplus buildings over five years.
“We’re consistent on the magnitude of the changes that need to occur,” Floyd said.
Additional reporting by Paul Socolar. This story was reported as part of a partnership in education news coverage between WHYY/NewsWorks and the Notebook.