The sale removes an albatross from the neck of the Tolentine Community Center and Development Corp., which purchased the armory from the state in 2003 for $106,246.
Anna Mattei, Tolentine's board president, said the state promised to kick in grants to help the nonprofit repair the dilapidated structure, on Broad Street near Wharton. The funding never materialized.
Instead, she said, Tolentine shelled out close to $500,000 of its own money for repairs that prevented the building from becoming a danger to the neighborhood.
"It's been a nightmare," Mattei said.
She declined to reveal the sale price, but said half the proceeds have to be shared with the state.
"We'll probably lose money on the deal," Mattei added.
One of the terms of the 2003 sale prevented Tolentine from reselling the armory.
That changed last year, when state Sen. Larry Farnese, D-Philadelphia, introduced and helped pass legislation that lifted the restriction.
Cameron Kline, Farnese's spokesman, said community residents and potential developers had long complained that the armory was wasting away.
"It's an enormous building that had a lot of potential," he said.
Vincent Mancini, of Landmark Architectural Design, said his firm crafted a sleek, modern vision of a structure for the site, which will house 50 apartments and have a surface parking lot with 53 spaces.
"We tried to be respectful of the neighborhood with the way we've configured it," Mancini said. "The response from the community has been very, very positive."
Groundbreaking is scheduled for July, he said, and construction should take about 18 months.
The blog Hidden City Philadelphia reported last year that the Third Regiment was started as a volunteer militia by Benjamin Franklin in 1747. The armory regularly hummed to life when the regiment was called to service, including during the Spanish-American War.
"I suspect a lot of people just look at it as an old abandoned building," said Tim Babbage, who lives on Wharton Street near Clarion. "I like history, but you can't preserve everything."
On Twitter: @dgambacorta