Elie Schwartz’s Philly Office Pitched as Conversion

More than two years after being foreclosed on, the Philadelphia office building once owned by disgraced Elie Shwartz’s Nightingale is staring down a very different future.

CBRE is preparing to list the 2.2-million-square-foot property at 1500 Market Street, Bisnow reported. The sale of the city’s largest office property is expected to yield slightly more than $100 million, an 80 percent drop in its appraised value from five years ago.

It’s also a significant fall from the $328 million Schwartz’s Nightingale Properties and InterVest Capital Partners spent on their acquisition in 2017, refinancing the property two years later with a $390 million loan from JPMorgan Chase.

Wells Fargo got a hold of the property’s debt and filed to foreclose in January 2023 on behalf of investors in the CMBS trust that owns the debt. The Center City property has been in receivership for more than two years.

But CBRE is finally ready to put it on the market. Centre Square is being pitched as a blank slate — not far-fetched considering the 36 percent occupancy rate — that can be converted into residential, retail or hotel use.

Occupancy at Centre Square has rapidly fallen off. Last year, law firm Dilworth Paxson agreed to relocate from 1500 Market Street to One Liberty Place, abandoning 83,000 square feet behind. Saul Ewing is set to exit 111,000 square feet next year. Other tenants part of the exodus have included Willis Towers Watson, Berwind and Comcast.

Green Street’s Real Estate Alert first reported on the pending listing.

Schwartz received an 87-month prison sentence for orchestrating a $63 million real estate fraud scheme. Schwartz pleaded guilty to wire fraud in February and received his sentence in May, which includes more than seven years in prison plus two years of supervised release.

Schwartz admitted to embezzling more than $53 million raised through crowdfunding platform CrowdStreet for two commercial real estate acquisitions that never closed.

He defrauded more than 800 investors who believed their money would fund the acquisition of the nearly 1 million-square-foot Atlanta Financial Center office building and finance renovations of a Miami Beach mixed-use property.

Instead, Schwartz diverted investor funds to personal accounts, purchasing luxury watches and art, paying credit card debt and covering expenses at other properties.

— Holden Walter-Warner