Closed architecture charter school sells east Center City building to Philly private equity firm Lubert-Adler
The sale came about a year after CHAD was shuttered in a deal with the School District of Philadelphia that headed off hearings that could have resulted in the nonrenewal of its charter to operate.
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Leaders of a closed Philadelphia charter school have sold its building at Seventh and Sansom Streets to an affiliate of investment group Lubert-Adler for $11.8 million, most of which will be used to pay off a bond that had been issued to pay for the property and its renovation.
A subsidiary of the foundation that owns the building of the defunct Charter High School for Architecture and Design sold the five-story, roughly 125,000-square-foot building on July 30, according to records filed with the city.
Dean Adler, a Lubert-Adler partner, said Thursday that his group had not yet settled on a plan for the site.
The sale by the subsidiary of Designing Futures Foundation, the nonprofit that owned the school building on the charter’s behalf, came about a year after the school was closed in a deal with the School District of Philadelphia as it faced the possible nonrenewal of its charter to operate.
CHAD, as the school is known, opened in 1999 with the goal of sending more African American students into architecture. But a district evaluation in 2018 found declining test scores and attendance, noncompliance with special-education requirements, and financial issues.
Proceeds from the building’s sale last month were used to pay off $7.67 million still owed against tax-exempt bonds authorized in 2012, which had been used to refinance the original mortgage for the purchase of the property at 105-17 S. Seventh St., according to the Philadelphia Authority for Industrial Redevelopment.
The nonprofit owed an additional $787,000 in other debt as of June 30, 2018, the last date for which its tax documents are publicly available.
Lance Rothstein, president of CHAD’s board of trustees, was on vacation Thursday and not immediately available to discuss what it plans to do with those proceeds.
Nonprofits are legally obligated to use proceeds from any asset sales in ways that are consistent with their stated purpose when they were formed, said Kathleen M. Thomas, a lawyer specializing in nonprofit law at High Swartz LLP in Doylestown. If they dissolve, they are required to transfer any funds they have on hand to another nonprofit with a similar mission, she said.