Ultra-luxury condominium developer had humble beginning

Growing up in a Northeast Philadelphia rowhouse, Tom Scannapieco never imagined that he would live in a multimillion-dollar condo tower overlooking Independence Hall - especially one he'd be building himself at 500 Walnut St.

Scannapieco Development Corp. plans to break ground early next year on the $178 million 500 Walnut project, with condominiums starting at $2.5 million and going up to $17.61 million for the penthouse. Averaging more than 3,500 square feet, many of the units are full floors.

Scannapieco and his wife, Alycia, will move into the 26-story building once it's complete, although he won't say which of the 38 units they will occupy.

"My wife is anxious to move in," Scannapieco said recently. The couple, who live in New Hope, have two grown children, Lindsey and Michael.

"No one else is in the ultra-luxury business in the city," he said. So far, Scannapieco has booked $60 million in sales at 500 Walnut.

What's driving the million-dollar-plus condo market in Philadelphia?

"Inner-city living is accelerating; people want the lifestyle," he said, but those buyers don't want to give up the space of their suburban homes. When Scannapieco built 1706 Rittenhouse, two-thirds of the buyers moved in from the suburbs.

"There's a second wave now" of condo building since the 2003-2007 period, when the Murano, the Ritz-Carlton, the Aria, 10 Rittenhouse, Two Liberty, the Parc Rittenhouse, Waterfront Square, and Symphony House all went up.

Competitors include developer Carl Dranoff, who recently announced that his One Riverside complex will be $700,000-plus condos for sale rather than rental.

Scannapieco called One Riverside "positive for the sales market. It's a great message."

"Carl's units average about 1,800 square feet; ours average 3,500 square feet. We allow for full customization of the units; buyers can bring in their own interior designers and design architects."

A graduate of St. Joseph's University with a degree in physics, Scannapieco, 65, worked as an engineer at Naval Air Development Center in Warminster. In 1974, he began rehabbing shells on Spring Garden and Wallace Streets purchased for $11,000 each, renovating and selling them as three full-floor condos. In five years, he said, he did more than 100 units. Eventually, he expanded to bigger projects in Baltimore and Atlantic City.

Scannapieco said he learned an important lesson with Waterview, his $37 million, 28-unit condo project on the banks of the Delaware River in New Hope.

"People were willing to pay almost anything to live there," he recalled. "One prospective buyer, a woman, picked up Paula [his longtime sales manager] in a limo, they drove to this woman's estate, and she said, 'How many units do I have to buy to fit all my stuff?' I realized right then this buyer will pay any price. I am selling to the One Percent."

Waterview offered one unit per floor.

"That formula - large floor plan, high windows and ceiling heights - is highly desirable," he said. "Our buyer is used to large spaces. But they want the richness of experience and the diversity of the city, but then they go home to our condos and not have to worry about their neighbors, who are used to spending on a big staff, and aren't worried about spending on amenities. Those are the people they want to live with."

For a Feltonville boy, it's been a successful career. And his daughter is taking up the mantle: Lindsey Scannapieco has bought a shell on East Passyunk Avenue to renovate.

His advice for new developers?

"I would tell them to dedicate themselves to paying attention to the details. Surround yourself with the best professionals, and don't worry about all you don't know. You will get there."

Oh, and hold on to some properties you renovate: A shell at 20th and Wallace Streets he bought for $11,000 sold for $400,000 in 1988, and is likely now worth at least $1 million, Scannapieco said.

"I should have built one to sell and then kept one to own!"

One Riverside

Developer: Dranoff Properties

Project size: $100 million

Total area: 167,000 square feet

Units: 88

Price range: $700,000 to $4 million

Estimated opening: 2016

Avg. unit size: 1,800 square feet

Parking: 96 spaces, valet parking underground, retrieve cars

Customizable: No

500 Walnut

Developer: Scannapieco Development

Project size: $178 million

Total area: 178,000 square feet

Units: 38

Price range: $2.5 million to $8 million, up to $17.61 million for penthouses

Estimated opening: 2017

Avg. unit size: 3,500 square feet

Parking: 90 spaces, robotic parking

Customizable: Yes

SOURCE: Scannapieco Development Corp.

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