700,000 SF OF OFFICE BUILDINGS, PENNSYLVANIA AND NEW JERSEY
The Seltzer Organization, was one of the largest and most successful land, office,
industrial and residential property developers in the history ofPhiladelphia. Philip Seltzer was one of the first developers of suburban office parks of 1,000,000 square feet and larger. TheFortWashingtonParkin thePhiladelphiasuburbs, was one of the most famous of these parks. In all, Phil developed about fifteen of such suburban office parks. He was a fearless real estate genius who bought, over the phone ( before the advent of the internet and Google Earth) tens of thousand of acres of land for development in locations as diverse as New Jersey, Pennsylvania, Texas, Oklahoma, Toronto, Atlanta and New York. He even purchased aCaribbeanisland of substantial size. Phil was also a dedicated philanthropist, making large contributions of money and time to The University of Pennsylvania and many charities. The man was a living legend, and rightly so. He died a few years ago.
We made it our business to visit Phil at his office inFortWashingtonand introduce ourselves. He had a big smile and couldn’t have been a more gracious host. We told him of our admiration for him and that we wanted to joint venture some major projects with the Seltzer Organization. He said that he would love to join with us in some ventures, but that he didn’t think he would be a good partner for us – because he was financially over-extended. We didn’t care. We wanted to learn from and work with him. Besides, he may have been financially over-extended but he owned thousands of acres, free and clear — much of it in prime locations – ripe for development.
Phi had some good land inNew Jersey, on Route 1 just north of Princeton and an office park with developable land at an exit on the 287 beltway, inMorrisCounty. At the time, Phil was enthusiastic about development of high tech buildings – very modern looking single story buildings with glass and or aluminum skin. These high tech buildings were about 100,000 square feet each and had five car parking for every 1,000 square feet of building. These buildings were not meant to be corporate executive offices. They would be filled, chock-a-block, with hard working office workers for pharmaceutical, telephone and credit card companies. We told Phil that we were intending to go to Aetna Business Credit to arrange 100% project financing. With the land contributed at no cost, it should be easy to do. “Not a good idea,” said Phil. Not good because Aetna Life was suing The Seltzer Organization for millions of dollars on defaulted loans. We were not deterred. We visited Aetna Business Credit inEast Hartfordand had a long talk with the person in charge of lending – a long time friend. We told the story about the good land being contributed without cost and about the good people involved. We discussed theAetnasuit against Seltzer and explained that it was not really a willful fault. The office market had gone south and some huge new Seltzer downtownAtlantaoffice buildings were consequently leasing very slowly. Seltzer was long on land and short on funds. These were the reasons why interest wasn’t being paid. But in the case of the proposed, single story high tech buildings inNew Jersey, the land we were contributing free and clear accounted for a healthy percentage of the project cost – and the market was strong. The development of the proposed buildings inNew Jerseywas a way of unlocking some of Seltzer’s land equity and could be a source of funds to pay the back interest on the loans that were in default. The story went over well and we wound up very successfully developing and selling about eight of these high tech buildings over a few years and Seltzer used his share of proceeds to get out of the soup withAetnalife. So reason prevailed.
Although Phil was a real estate genius, not all of his investments were brilliant. Phil had purchased 20,000 acres in HazeltonPennsylvania, for a few hundred dollars per acre.
Hazelton is located about 90 miles due west of theNew Jerseyborder, right off Interstate 80. At one time, Hazelton was prosperous because of its vast, close to the surface, anthracite (hard) coal deposits. But unfortunately, anthracite coal has very few takers today. Phil said he had spent millions of dollars over the years to try to get development going on his Hazelton land – a ski resort, a summer resort and a large amusement park — but no success. Phil told us that if we could figure out how to successfully develop a meaningful portion of his Hazelton land, he would deed half of it –10,000 acres – to us for one dollar. With a great enthusiasm, we set out on our journey to Hazelton, to reconnoiter and figure out some grand idea of how to develop most or all of the land. Upon arrival, we discovered that downtown Hazelton was a ghost town. The few people we did see, going in and out of old broken down buildings, were senior citizens in wheel chairs or on crutches. Any Hazeltonians who were able, had left town long ago. As for Seltzer land, it was just plain ugly. Stunted, gnarled trees dotted the landscape. The soil was highly acidic due to the anthracite deposits and thus the deformity of the trees. The only ideas for utilization of the land, that came to mind, were a huge high security prison and a nuclear waste repository. Neither idea was very practical at the time. Lesson learned: not all land is necessary valuable, even if it is only a 90 minute drive fromNew Jersey, on an interstate highway. A footnote to the story is that subsequent to our visit, a large truck stop and some very large, very low rent warehouses have been developed but most of the land is still available, if you have any good ideas.