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Philadelphia Real Estate Law Blog

Pennsylvania Supreme Court decides eminent domain case

The Pennsylvania Supreme Court recently ruled that a state law that allows for the seizure of private lands by companies for certain natural gas projects is unconstitutional. The ruling was unanimous and may have a significant impact on one of the biggest proposed pipelines in the state. The original rule from 2012 permitted any company the authority to take private land for the purposes of storing natural gas underground using the eminent domain process.

In reaching the decision, the court found that the rule allows private companies to take land in a manner that is unconstitutional with no direct or obvious benefit to the citizens of Pennsylvania. Oil and gas companies argued the takings provide a benefit by providing jobs but the court did not agree. The court was concerned that was not the primary reason for the rule.

Historic church headed toward 'adaptive reuse' as daycare, condos

This blog has written about numerous instances in Philadelphia where an historic church has been slated for demolition or renovation only to encounter opposition from former parishoners or other preservationists. Another historic church may have been headed for a similar fate when a developer purchased the building and announced a redevelopment plan that preserved the "interior fabric" of the church. The plan has just received approval from the Zoning Board of Adjustment.

The church, First African Baptist Church, located at 1600 Christian Street, was founded in 1809, and the current structure was built in 1906. The church is one of the city's oldest African-American churches. Last year, the building was sold; this action divided the congregation. The interior of the church fell into serious disrepair, and the building was slated for demolition. The structure was then purchased by MLK Real Estate.

Resolving disputed ownership claims for real property

As we have noted before in this blog, land is a unique form of property where mere possession does not necessary indicate ownership. In a city as old as Philadelphia, a single parcel of land may have been sold, subdivided or had its boundaries modified on dozens of occasions. Determining ownership in such cases may be necessary to secure a loan, to obtain development approval from the City or resolve the status of property bequeathed in a will.

The basic method for resolving such disputes is called an action to quiet title. As the name implies, a quite title action usually requires commencement of a law suit. The law suit has nothing to do with ambient noise; rather, it is intended to "quiet" any and all claims to the property that conflict with the claim of the party trying to establish its ownership. A quiet title action does not deal only with questions of ownership. A quiet title action may also be necessary to eliminate invalid liens or easements that have lapsed due to the passage of time. A quiet title action can also eliminate claims that were never properly reduced to writing or recorded with the county.

City Council considers bill to stop transfer tax dodgers

Every sale of real estate in Pennsylvania is subject to a transfer tax based on the sale price that must be paid when the deed is recorded. Municipalities are allowed to add their own transfer tax to the 1% levy by the state. Philadelphia adds 3% to the state tax and is estimated to charge the highest transfer tax of any major U. S. city. For years, however, buyers and sellers of commercial real estate have used a number of measures to escape the full burden of the tax. Now, the City Council is considering a bill to end these practices.

One common method of escaping the full transfer tax is the retention by the seller of a small interest in the property rather than selling it outright. A second is to convey title to a partnership or corporation and then to sell the partnership or shares in the corporation, In either case, the amount of transfer tax that is actually paid is either eliminated or greatly reduced.

Jewelers' Row dispute moves to Historical Commission

Several weeks ago, this blog wrote about the controversy surrounding the proposal by Toll Brothers to demolish five properties on a stretch of Sansom Street known as Jewelers' Row in Philadelphia and replace them with a 16-story condominium tower. At that time, the city notified the developer that the commercial real estate project must be considered by the City's Design Review committee before demolition can begin. Now, the dispute has found a new forum - the Philadelphia Historic Preservation Commission.

The Preservation Alliance of Greater Philadelphia invoked a different land use law by filing a petition with the Commission asking for review by the Committee on Historic Designation to determine whether the five buildings should be placed on the city's Register of Historic Places. The letter requesting inclusion on the register said that the buildings were "significant" because of their connection with one of the city's early publishers, Henry C. Lea. According to the letter, the buildings are also representative of commercial "street architecture" of the late 19th century.

PennDOT to control digital signage on East Market Street

Most Philadelphians think of zoning as a set of regulations that controls the kind and size of buildings that can be erected on a specified tract of land. Zoning regulations also affect another important aspect of commercial real estate: the use of buildings as sites for large outdoor signs. The digital age has brought with it new techniques for creating and operating outdoor advertising, and the City of Philadelphia is attempting to cope with these advances by creating commercial advertising districts in which the type and size of digital signs is subject to review.

In 2011, the city created the Market Street East Advertising District to control digital advertising screens on East Market Street between Seventh and Thirteenth Streets. The district allows developers to add digital signage to commercial properties that incorporate public improvements of at least $10 million. The creation of such districts is ultimately subject to the approval of the Federal Highway Administration, and it now appears that the city has failed to satisfy some FHA requirements necessary to retain that control.

Understanding title insurance in Pennsylvania

Anyone who has bought a home in Philadelphia and borrowed a portion of the purchase price from a bank or other lender in the last forty years has been required to purchase something called "title insurance." The premium for the title insurance policy is generally one of the smaller expenses paid by the buyer at closing, and most people pay it without asking too many questions. In this post, we want to review the role of title insurance in a residential real estate transaction and help home buyers understand what it is and how it works.

Ownership of most kinds of property can be determined by possession or, as in the case of automobiles, by a formal registration system run by the state. Real property is different because possession is not always the same as legal ownership. In order to provide a reliable method of verifying the existence of interests in real property, Pennsylvania and all other states have established a system of recording all transactions involving real property. When a person buys a house, the seller executes a deed conveying ownership to the buyer. This deed is recorded with the county in which the property is located, along with any other document that creates an interest in the land, such as a mortgage or mechanics' lien. The recording of these transfers or conveyances allows the public to determine who owns a tract of land and whether anyone holds an interest in the land.

Sale of Greylock Estate complicated by liens and easements

A large residential property stands vacant, leaving a mortgage in default and unpaid back taxes. The property is worth more than the accumulated mortgage deficiency and unpaid taxes, so the solution seems simple: sell the property and pay the taxes and mortgage arrearage out of the proceeds. The seeming simplicity of this solution can run into trouble when the property is a historic mansion in Chestnut Hill and any sale can entail a number of real estate disputes.

Greylock is a Jacobean mansion in Chestnut Hill that was built in 1909 as a retirement home for a steel magnate. After serving as offices for a non-profit organization, the house has stood vacant for several years. Now, the holder of a mortgage on the estate wants to recoup the unpaid amount of the loan and to pay off back taxes by selling the property. Accumulated taxes are approximately $90,000, and but the mortgage deficiency is undisclosed. Other parties have filed liens against the property that must also be paid. The Office of Property Assessment says the property has a fair market value of $2,340,800. At the request of the mortgage holder, a sheriff's sale of the property has been set for Nov. 1, 2016.

More review needed for Jewelers' Row condo tower

Lying just one block from Independence Hall, Jewelers' Row is one of Philadelphia's most historically significant merchant districts. Since 1851, the district has been home to hundreds of jewelers. Now, however, a condominium development project will forever change the face of Jewelers' Row - if it receives approval from the City's Design Review Committee.

The 18 story tower comprises 80 condominium units that would replace five properties in the 700 block of Sansom Street. The project received conditional approval from the City's Department of Licenses and Inspections, but a recent snag threatens to at least slow the project and delay the start of construction.

Denial of variance may force treatment center to close

In Philadelphia and its suburbs, zoning boards often operate under the radar. Their decisions on rezonings, conditional use permits, map overlays and other land use issues receive little publicity unless a decision threatens the economic well-being of another business. Such a dispute is just beginning in Easton, where the zoning board has denied a use variance request that may force an alcohol and drug treatment center to close.

The Northeast Treatment Center has operated in Easton for 21 years, but its future is now threatened by a redevelopment plan that calls for the renovation of the building into 28 high-end apartments. The treatment center thought that it had an easy solution: move to another building about three blocks away. Unfortunately, treatment centers are not permitted in the zoning district where the center's potential new home stands.

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