The Divine Lorraine will become apartments again, as hotel transformation is abandoned

North Philadelphia’s iconic Divine Lorraine will again become an apartment building after a stint as an extended-stay hotel fizzled amid a messy ownership dispute.

The building was originally developed as a hotel in the 1890s and later hosted a famed religious congregation but was abandoned in the 2000s.

In 2016, developer Eric Blumenfeld rehabbed the structure into apartments at a cost of $44 million, but six years later, he terminated tenants’ leases to transform the building into a hotel.

But in 2023, Blumenfeld lost control of the building. His chief lender, Susquehanna Structured Capital, foreclosed on the North Broad Street landmark that year citing nearly $100 million unpaid debt.

The hotel operator Blumenfeld had brought in, Mint House, ended operations in the building at the close of 2024. Susquehanna will begin renting apartments in April, according to a front desk clerk in the building.

The six small businesses in the bottom floors of the Divine Lorraine are still open, including a coffee shop called “the daily,” a cocktail bar called “foundation,” and the restaurant Cicala.

“Mint House was gone as of Dec. 31,” said Robert Del Femine, who co-owns the cafe, bar, and an underground performance venue in the building’s basement. “I don’t know how long it’ll take, but they’re [Susquehanna] converting toward furnished and non-furnished apartments.”

Mint House did not respond to a request for comment.

This latest twist in the Divine Lorraine’s saga comes after Blumenfeld’s failed effort to maintain control of the building and dispute his debts to Susquehanna and other lenders.

The developer told The Inquirer in 2023 that he wanted to work with Jeffrey Yass, Pennsylvania’s richest man and the owner of Susquehanna International Group (SIG), which is affiliated with many of the firms that lent money to Blumenfeld for his North Broad redevelopment projects, including the nearby Met, a popular concert venue.

But Blumenfeld also countersued, alleging that he was the victim of predatory lenders.

Late last year, the developer lost his case and in early February was ordered by a judge to pay a personal judgment totaling over $50 million.

He did not respond to a request for comment.

In the meantime, Susquehanna Structured Capital has been operating the building. A SIG spokesperson did not respond to a request for comment.

“The owner, the landlord of the building, is Susquehanna. That’s who we pay rent to. That’s who we talk to,” said Del Femine, who said he started receiving a lot of concerned messages at the beginning of this year regarding the fate of his businesses in the historic building.

On Google maps, the Divine Lorraine is listed as “permanently closed,” which led to speculations on social media that the restaurants and other small businesses within the building had shuttered.

Del Femine took to Reddit and Instagram to correct that impression but said he first ran his messaging about the closure of Mint House’s operations and the apartment renovation past Susquehanna.

“I want to be respectful to the people that own the building, so I showed them what I was doing” on social media, Del Femine said.

Susquehanna’s quiet management of the building is in sharp contrast to Blumenfeld’s bombastic, hands-on style.

The son of a prominent developer, he inherited properties such as South Street’s Abbott’s Square and developed another condo project on South Broad known as the Marine Club.

When Blumenfeld picked up the Divine Lorraine on North Broad in 2012, the towering, vacant, and graffiti-scarred edifice had become a sign of the city’s decline. His estimated $3 million purchase was seen as a big risk but also a signal of Philadelphia’s rebounding real estate market.

He pitched the revitalization of North Broad as key to the city’s future and personally led media and investors on tours of the abandoned structures to whip up support.

In recent years, Blumenfeld’s mounting legal woes have undermined his position, and he has lost most of his real estate empire, including his South Philly properties.

Today, some observers said they wish Susquehanna would be a little more forthcoming about the building’s future.

Shalimar Thomas, executive director of the business improvement district North Broad Renaissance, said she learned of the new plans for the Divine Lorraine on social media.

North Broad Renaissance assesses fees on commercial property owners and then provides hyperlocal services and planning for the area. As a result, Thomas is in close contact with many business owners but said she’s never heard from anyone at Susquehanna.

“We haven’t met or connected with them at all,” Thomas said. “My whole thing is, whatever happens, let’s just not see vacancies. Let’s not find out through social media. Let’s build a better relationship with the organization, so that we can understand what’s going on.”

This story has been updated to correct Robert Del Femine’s name.