New York developer plans 600 loft apartments in Wanamaker Building above former Macy’s space
TF Cornerstone will keep some office and retail space while adding apartments above the former store.
New York developer TF Cornerstone won complete control of the historic Wanamaker Building at a foreclosure auction Tuesday.
The company, which is known for adapting historic structures, purchased the three-floor retail section of the building in 2019. It had housed Macy’s until earlier this year.
At the auction, TF Cornerstone won control of the sparsely populated floors of office space above the retail space along with a 660-car underground parking garage.
TF Cornerstone plans 600 loft-style apartments for floors 6 to 12, while keeping the fourth and fifth floors as office space. The storied Crystal Tea Room on the ninth floor will continue to be used as an event space.
The former Macy’s space will include two floors of “well-curated” retail, according to the company’s news release. The Grand Court will continue to be open to the public, and the Wanamaker Organ will remain in use. The remaining former retail space will host “one or more cultural uses [on] the third floor of the building, which enjoys 24-foot-tall ceilings.”
TF Cornerstone announced that construction will begin in the first quarter of 2026 and is expected to take two years to complete. Some of the office space and “potentially” the Crystal Tea Room will still be accessible during redevelopment.
“As the building enters its next chapter under our helm, we feel privileged to be given the opportunity to reimagine this iconic building in a way that respects its historic integrity and adds to the vibrancy of the Center City community,” said Jake Elghanayan, senior vice president of TF Cornerstone, in a statement included in the news release.
TF Cornerstone has deep roots in New York City’s hypercompetitive real estate industry and owns and operates 12,000 residential units there. The redevelopment of the almost 1.4 million-square-foot Wanamaker Building is the company’s first project in Philadelphia.
In a previous statement to The Inquirer, TF Cornerstone highlighted its experience within historic preservation regulations to refashion older buildings in both New York and Washington, D.C.
TF Cornerstone bought the retail section of the Wanamaker building for $40 million in 2019 and purchased the debt for the struggling office portion last fall after the previous owners Philadelphia-based Rubenstein Partners filed for foreclosure.
Rubenstein had acquired the property in 2017 and invested heavily in renovations, getting office occupancy to 90% pre-pandemic. But after COVID-19 struck, the Wanamaker Building struggled to retain tenants, and vacancy soared to almost 77% last March, while the building’s assessed value plummeted.
“It would take an extremely long time to backfill the building with office tenants at [this] rate,” said Tom Weitzel, managing director of global real estate services’ firm Jones Lang LaSalle’s Philadelphia office. “This type of conversion helps in so many ways, with public safety, more people during business and evening hours. It’s very welcome news.”
Rubenstein Partners declined to comment.
The Wanamaker Building is covered by the city’s most flexible zoning, and TF Cornerstone will take advantage of the 10-year property tax abatement for building redevelopment. (The controversial abatement policy was halved in strength for new construction in 2019.)
Since the closure of Macy’s was announced earlier this year, TF Cornerstone has assured preservationists that the Wanamaker Organ would remain intact. The fate of holiday traditions like the light show and the Dickens Christmas Village are not clear.
The Grand Court will be restored and remain a public space, and the Wanamaker Organ will continue to be played, preserving Wanamaker’s central role as “a cathedral of commerce within Philadelphia,” according to Tuesday’s news release.
The company said it would host “a number of exciting events” in the former Macy’s space later this year.
Ray Biswanger, executive director of the Friends of the Wanamaker Organ, was quoted in the news release as praising the group’s “very close and fruitful relationship with the new owners of the Wanamaker Building.”
TF Cornerstone’s plans have been praised by Center City boosters, as the office market has still not rebounded enough to absorb the significant vacancies in buildings like the Wanamaker. After the Philadelphia 76ers abandoned their plans for a basketball arena on East Market Street, Mayor Cherelle L. Parker has promised to make the beleaguered corridor a priority.
A renewed Wanamaker Building would be essential for any forward momentum.
“The Wanamaker redevelopment will bring a significant infusion of residents alongside curated retail and preserved public spaces, generating the kind of consistent foot traffic and economic activity that will benefit the entire corridor,” said Prema Katari Gupta, president of the Center City District.