Should the Episcopal Cathedral of Philadelphia be allowed to destroy two historically recognized buildings it owns, and build a 25-story apartment, office, and retail complex in their place, in order to finance cathedral repairs and expand its ministry?

That is the question coming Friday before the Philadelphia Historical Commission, which deadlocked on the issue May 11 when it first arose. The four representatives of the Nutter administration voted in favor of demolition of the properties on the 3700 block of Chestnut Street, while all four independent members opposed the plan.

In an unusual step, Alan Greenberger, deputy mayor for economic development, endorsed the demolition and development in a letter passed out to commissioners just before the hearing.

Without the demolition and an infusion of profit from subsequent development, the cathedral faces a growing threat of structural collapse, backers of the proposal argue. Doubters wonder if the cathedral is in such rickety condition, and some are concerned about financial problems inherent in a large and potentially risky real-estate venture.

Preservationists are troubled not only by the demolition proposal, but also by its larger public-policy implications. The cathedral contends that the demolition is "in the public interest" and therefore justified under the city's preservation ordinance.

John Gallery, head of the Preservation Alliance of Greater Philadelphia, says that such a justification opens the door for any owner of several historic buildings to push for development as a means of preservation.

In an interview, Greenberger said the project addressed the "real problem" of underused and financially troubled churches. That the cathedral is not empty and is well-used is not the issue, he said. It cannot afford maintenance costs for its building.

"This was the plan in front of us," he said, and the commission would have to address similar situations on a case-by-case basis.

The cathedral on South 38th Street, known as the Church of the Saviour until it was named the cathedral in 1991, was built in 1855 and redesigned in 1889 by noted ecclesiastical architect Charles M. Burns. After a devastating fire, Burns redesigned it again in 1902. Burns also designed the two three-story brownstones on Chestnut Street that the cathedral wants to knock down. The houses, fashioned to complement the brownstone cathedral, serve as its rectory and parish house.

All three properties are on the National Register of Historic Places and were placed on the local register in 1981.

A decade ago, the dean of the cathedral, the Rev. Richard Giles, with the backing of Bishop Charles E. Bennison Jr., renovated the cathedral interior - widely considered the finest intact Victorian interior in the region - by obliterating elaborate murals by Edwin Blashfield, and removing sculpture, furniture, and pews. The actions shocked many preservationists and parishioners alike.

Now the cathedral is back with another proposal that seeks to alter its own historic fabric, and this time, the proposal has substantial policy implications, preservationists say.

"It represents a grave danger of widening the interpretation of the [preservation] ordinance," Gallery said. "It opens the opportunity for other owners of multiple historic properties to make the claim that demolition of one should be allowed in order to preserve another."

The dean of the cathedral, Judith Sullivan, and David Yeager, head of Radnor Property Group, the cathedral's private partner, say that is exactly what they want to do.

"We are petitioning for demolition of the buildings," Sullivan said during a recent interview.

"In order to save the cathedral," Yeager said, completing her thought.

"In order to save the cathedral," Sullivan affirmed.

This is a crucial element of the application. Because the diocese and cathedral refuse to sell any of the buildings, they must persuade the commission that demolition will serve a greater public interest than keeping the buildings. In this case, that greater public interest is repair of the historic cathedral and revitalization of its religious and social services.

But Episcopal services are readily available at nearby locations to those who need them. And, in any event, critics say, offering religious and social services is what churches do.

"It worries me that the argument that 'we need money to perform normal operations' is now being made as 'in the public interest,' " said Gallery.

Yeager, the developer, refused to say how much money would flow to the cathedral or what percentage of any ongoing profit the cathedral might receive.

In an interview, Yeager did say that his group was willing to put $1.3 million into "critical" repairs - stabilizing the cathedral tower.

The cathedral application for demolition paints a picture of a tower verging on "partial or complete collapse" if not attended to, as one letter from an engineer hired by the developer put it.

The $1.3 million is less than half of the $3.5 million the cathedral's application says is needed for full repairs and renovation.

How bad is the tower's condition? At the April 24 meeting of the commission's architectural committee, committee member Suzanne Penz, an engineer, observed that "the conditions at the cathedral seem 'ordinary' not 'extraordinary.' " She questioned the cost estimate of repairs, according to minutes of the meeting, and "stated that she was disputing them."

Mark Coggin, the engineer who prepared the engineering report for the cathedral, said the tower posed "a public threat" as early as 2003, when he first examined it. It is now riddled with cracks and is "moving and shifting," he said.

Architect James S. Kise, who prepared a master plan for the diocesan development of the 3700 block of Chestnut Street a little more than 10 years ago - a couple of years before Coggin's observations - said in a recent interview that "there were no issues with the fabric of the church when we finished our master plan."

Bennison, the bishop, proposed more than a decade ago that the diocese move its headquarters from its building on South Fourth Street in Society Hill to new quarters carved out of a diocesan development on the 3700 block of Chestnut Street - triggering the Kise master plan. That project, dubbed Cathedral Commons, has seen several versions proposed over the last decade, including the purchase of an apartment building in the block in 2005 for $1.7 million, according to city real-estate records.

At the same time, Bennison was pursuing a controversial development plan, dubbed Camp Wapiti, a 400-acre property on Chesapeake Bay that has drained Episcopal coffers and is now being sold over the bishop's objections.

Bennison did not respond to requests for comment.

Lay Episcopal leaders, none of whom would speak for publication, said there was concern that the diocese has a hand in the current cathedral-development plan.

Sullivan, cathedral dean, said flatly that the development was the cathedral's alone.

"The cathedral chapter [the governing board of the cathedral] has taken the lead with my leadership in developing this project and partnering with the Radnor Property Group," Sullivan said. "The bishop is the chair of the cathedral chapter, that is true. He chairs many of these around the diocese. But this is entirely a cathedral project. . . . It is very different from Camp Wapiti."

One other aspect of the deal concerns some members of the diocese. Using a loan from Republic Bank, the cathedral in 2011 acquired the diocese's apartment building on the 3700 block of Chestnut Street for $2.6 million.

The loan is backed by unrestricted funds from the cathedral's ample endowment. That endowment throws off about $600,000 annually for cathedral operations, according to diocese documents, nearly covering the annual operating costs.

Sullivan said the cathedral put up no cash to buy the apartment house, leaving its endowment exposed should the larger development plan sour.

What would happen then?

"It would be back to the drawing board," she said. "I don't have a Plan B."

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Contact Stephan Salisbury

at 215-854-5594, ssalisbury@phillynews.com, or follow on Twitter @SPSalisbury.