Despite financial obstacles, Hub 3939 - located at 3939 Chestnut St. - plans to break ground on an updated approach to student housing on campus in 60 days.
The apartment building, which will be the second Hub building to finish construction, will anchor the corner of 40th and Chestnut streets.
The project is in the final stages of financing after experiencing a major setback due to the current economic climate. Ground breaking is expected in about 60 days, or once financing is complete.
"We had to go back to square one" with financing, said Ahsan Nasratullah, CEO of Teres Holdings, the development firm behind the Hub buildings. He explained that the regional bank that originally committed to financing the $21-million project was absorbed this past spring by a large New York bank.
Since this spring, Teres has reevaluated Hub 3939's financial situation, assembling a group of small community banks to finance the necessary $13 million.
Nasratullah said they have secured about one-third of the funding, with about $5 million left to be collected.
He added that he hopes the project will be completely financed within the next two months.
Though he is optimistic, Nasratullah noted that the lending environment is "news driven," and bad economic news can cause lenders to close their wallets. "In this marketplace, you have to be agile and adapt," he said.
While finalizing financing, Teres is acquiring building permits so construction can begin as soon as possible.
The University is also eagerly awaiting the construction of new apartments on campus.
"We would hope there will be a ground breaking in the next six months," said Facilities and Real Estate Services executive director Ed Datz.
Hub 3939 will feature retail on the first two floors, adding roughly 12,200 square feet of retail space to an area just north of campus. There will be seven floors of residential space above that, housing 60 studio, as well as one- and two-bedroom apartments, with bi-level apartments on the top two floors.
Nasratullah said Teres is close to finalizing a lease with a popular dining establishment with a current location in Rittenhouse Square, which he did not name. Thai Singha restaurant, which is currently located at 3939 Chestnut St., will move into the second floor retail space in the new building once it is complete.
Hub 3939 will complement the post-modern design of the original Hub, and the two will appear "connected" by 3939's glass lobby, according to Nasratullah.
The three Hub buildings represent a push by the University to create first-class housing that is both safe and well managed for undergraduate and graduate students alike on Penn's campus, according to the PennConnects website.
The Hub project, like the Radian, is a ground lease, in which the developer leases the land from the University and operates the space itself.
"This will really be a nice addition to the Hub," Nasratullah said. He expects the project to be complete in about 16 months.
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