Highest and Best Use Study for Exelon

Challenge

Exelon approached Binswanger with the challenge of creating a Highest and Best Use Study for a decommissioned power plant facility in Philadelphia, Pennsylvania. The purpose of the study was to analyze the development potential for alternative land uses. The property was comprised of over 223,000 square feet situated on 10+ acres with riparian rights along the Delaware River. The demolition costs of the power plant and the environmentally hazardous conditions of the property had to be taken into consideration for all proposed scenarios outlined in the study.

Solution

Binswanger’s Appraisal Team got to work on assessing the property in order to present the plan for its Highest and Best Use. The team presented multiple viable scenarios:

1. Redevelopment of the existing improvements with a mixed-use for 290 apartment units, 335-car parking garage, commercial retail space and a Waterfront Marina.
2. Commercial reuse including an entertainment venue, restaurants, bars and a 40,000 square foot urban retail plaza with parking.
3. Demolition for redevelopment of two, high-rise condominium towers with over 500 units atop a parking garage and Waterfront Marina.

Result

In the end, the property was sold to a cash buyer through a sealed bid process. The scenarios that Binswanger provided in the study allowed the brokers and potential buyers to understand the long-term potential and up-side to the property. There have been discussions that the recent buyer is planning to develop a catering hall on the site following the plan for the proposed ‘Scenario B’ as an interim use.