Christian Association, U. for apart

CA officials deemed Penn's $3 million offer for their building "embarrassing." and Tammy Reiss The University's $3 million offer to purchase the Christian Association last week fell way short of what the group wants for the building, according to several sources. The CA is asking $8 million for the property, which sits in the heart of campus, sources said. Another University employee requesting anonymity, however, said the CA lowered its asking price this month to between $4 and $5 million. The University offered to pay "in excess of $125 per square foot," for the 24,000-square foot building located at 36th Street and Locust Walk, said Managing Director of Real Estate Tom Lussenhop, who described the deal as "fair and equitable for both parties." That price would work out to about $3 million. But CA Executive Board Chairperson Eric van Merkensteijn called the University's offer "embarrassing," and said University officials should consider how much they would sell the building for "if they owned it." Van Merkensteijn added that the offer fell "way below market value" for the building, though he refused to specify the building's worth. The building's value was appraised at only about $1.5 million four years ago, a University employee said. Additionally, the building requires extensive renovations, according to the employee. These include approximately $2.5 million to bring the building up to certain codes and make it appropriate for a University program such as the proposed Unity Center or Interfaith Center, which the CA management has voiced support for in the past. Lussenhop said the University's offer is more than enough to cover any possible renovation costs of the building. "We think this is a win-win situation, given the very substantial capital renovation needs of the building, which we understand could be in the millions of dollars," he said. Included in the University's $3 million offer was an additional $350,000 package to pay for the CA to relocate to an alternate campus location. The proposed deal would allow the CA to remain in a yet-to-be-determined building for 25 years without paying rent. "The University recognized there is a premium placed on the location of the Christian Association building," Lussenhop said, adding that Penn offered "to accommodate the Christian Association program in a 2,000 square foot office for 25 years, with no rent." The CA would have a "significant period of time" in which to locate the office space that "best responds to their mission," he said. If the organization is unable to find an adequate relocation site, "the University would liquidate its obligation to allow the CA to use its proceeds to address their situation in any way fit," he said. CA officials, however, hope future arrangements will allow the organization to remain in its current building, alongside several other "compatible programs," van Merkensteijn said in an earlier interview. To publicize the building's availability, an advertisement will appear in the real estate section of tomorrow's Wall Street Journal, van Merkensteijn said. But the Christian Association only appears interested in negotiating with the University, according to Palladium co-owner Roger Harmon. He added that the Seashore House -- a Children's Hospital of Philadelphia organization that currently rents space in the building -- expressed interest in purchasing the building, but that the CA rebuffed the offer. The Palladium and Gold Standard restaurants have contracts for the next five years and will remain in the building regardless of who owns it, Harmon said.

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