- May 3, 2013
- BRA Tabbed to Market, Net leased NH Staples, featured in the Real Reporter
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- May 3, 2013
- BRA Tabbed to Market, featured in the Real Reporter
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- May 1, 2013
- Sanford Buys Prime 27,000-SF Retail Site; BRA Brokers Deal Funded by Belmont Savings, featured in the Real Reporter
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- April 26, 2013
- Gateway to LMA Up for Sale With Parcel 135 Listed Via Boston Realty, featured in the Real Reporter
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Photo Credit: Boston Globe
According to the Boston Courant, a proposed Fenway residential tower would add 320 apartments, but no parking spaces. The company developing the parcel, Samuels & Associates, owns Trilogy at 180 Brookline Ave. Trilogy reportedly contains sufficient parking to quell the demand that the new building would bring.
The proposed high rise, known as the "The Point," would be located at the corner of Brookline Avenue and Boylston Street. The 22-story tower’s proposed unit mix consists of studio, one, two, and three bedroom rentals. The ground level would also be home to 33,000 square feet of retail space.
Residents of the neighborhood have expressed concern that more parking spaces would increase the area’s air pollution and traffic congestion. Many were happy to learn that The Point would not include new parking spaces.
However, Fenway is a rapidly changing area and whether residents approve or not, there are new parking spaces being added. Children’s Hospital has plans for a 525-space parking garage near Kenmore Square. The proposed five-building mixed-use Fenway Center development would also include 1,290 new spaces.
The Point isn’t the only thing Samuels & Associates is building in Fenway. The company is also responsible for the 1325 Fenway Triangle project (also know as Boylston West), located at 1325 Boylston Street, between Yawkey Way and Kilmarnock Street. Like the Point, the 700,000 SF Fenway Triangle project goes beyond residential, and will include office, retail, restaurants, and a Target store.
Read More: "Residential tower pitched for the Fenway" [Boston Globe]
Iconic shoemaker Converse has chosen Boston for its new world headquarters. The company, currently located in North Andover, will lease 187,000 square feet of office space in Lovejoy Wharf.
Located on Boston Harbor, near the Zakim Bridge, Lovejoy Wharf currently houses two dilapidated buildings and a neglected pier. The Beal Companies and The Related Companies plan to transform the site into a new office and residential development.
- Converse Picks Boston for World Headquarters [CoStar]
- Converse Explains Its Move to Hub's Lovejoy Wharf [Boston Business Journal]
Last month’s “Commercial Real Estate Market Update” event at the Needham Sheraton was a tremendous success with a high turnout of local business owners. For those that were unable to attend, the following is a brief recap of the presentation comparing Q4 2011 to three years prior.
2008 was arguably the peak of the commercial real estate market in Newton and Needham. Vacancy rates were low at 7.8% while the average office rental rate was in the mid-to-high $20’s per square foot. Fast forward to Q4 2011 when the vacancy rate spiked to 12.9% and rental rates were off by roughly 15%. Additionally, there was a strong decline in both the number of transactions completed and average deal size. Q4 2008 experienced thirty-one transactions averaging 3,079 sf compared to only twenty transactions with a 2,600 sf average in Q4 2011.
Although the 2011 statistics are rather dismal compared to those of 2008, the market is certainly showing signs of improvement. From mid-2009 to early 2011, the market experienced a low volume of office space tours as most tenants opted to sign 1-3 year renewals rather than relocating. This shift towards renewels was driven mainly by economic uncertainty, as businesses focused on merely staying above water instead of risking the distraction and expense of a potential move.
Since mid-2011, however, we have seen a strong increase in the number of companies looking to relocate. Many of these tenants, who are feeling more bullish and confident in their business, are signing longer term leases (4-5 years) in order to lock in the currently deflated rental rates. Due to these deflated rents, a significant proportion of those relocating are focused on upgrading to higher quality buildings than their current properties.
Essentially, tenants are paying less rent than they signed on for 3-4 years ago and receiving a better quality product for their dollar.
Boston Realty Advisors (BRA) was featured in the July 15th, 2011 issue of The Real Reporter because they are currently handling two exciting listings in Back Bay that will prove to be great rehabilitation projects.
493-497 Commonwealth Avenue
Formerly the JS Waterman Funeral Home, BRA's listing at 493-497 Commonwealth Avenue has been out of use for several years, and is finally going to be brought back to life. It is a 19,500 building currently in "shell condition." This makes the building a blank canvas. It may possibly become a residential space, but the central location could make for great offices or other forms of commercial space. The building is right on the edge of Kenmore square, which is a great area and will soon benefit from major improvements to Boston's Green Line. Boston Realty Advisors has not announced any definite details of a deal, but whatever happens, Kenmore square will soon have a new great space.
463 Beacon Street
Just a few blocks away, this beautiful building is currently a 20-room lodging house offering nightly and weekly rates. This property may stay as is, but according to BRA founder Jason Weissman, it is possible that the space may work as a single household. He also told The Real Reporter that converting the space to condominiums could be a viable and possibly more valuable solution. The building has 2,400 square feet of frontage on Beacon street, easy access to Massachusetts Avenue and a slew of prestigious Universities, and six parking spaces in the rear.
Boston Realty Advisors was yet again a recipient of CoStar's annual Power Broker award in the Boston commercial real estate market.
CoStar is the nation's leading commercial real estate information source. From available space for lease to sales listings to comparable transactions and more, commercial real estate professionals rely on CoStar for it's comprehensive and current databasing intellience.
Each year, CoStar compiles all transactions completed, and awards the highest grossing brokerages in each market the Power Broker award. This year, Boston Realty Advisors earned the title for the second time amongst Boston's best firms.
We are honored to recieve this title and look forward to earning it again in 2010.
The Boston Realty Advisors Commercial Brokerage team has a very unique knowledge and expertise in the Boston Office Market. If your firm currently occupies space or is looking to occupy space in the Greater Boston Area, please contact one of our Cambridge Office Space tenant representation specialists here.
Meredith Management’s John Rosenthal is preparing to start construction on the first piece of Fenway Center, a $450M, 1.3M SF project that includes a new commuter rail stop, residences, retail, offices, and parking adjacent to Fenway Park. He’s partnering with Sox owners on what will be one of the most ambitious projects to get started since the economic meltdown.
John, with Monika Butkiewicz and his wife Maureen Berkley, director of property management, look over a model and rendering of Fenway Center. It will have 1300 parking spaces, 330 residences, 370k SF of offices, 100k SF of retail, 30K SF of park and green space, bike storage, a day care center, and community space. “We are fully permitted and shovel ready,” he says. In this credit constrained economy, John has been securing debt financing from city, state and federal sources (including stimulus funds).
John also has a one-of-a-kind office in a converted 1700’s mill and some top office personnel who walk on four legs. We snapped him with Jon Hickok and Laura Hyer, with advisors Wiley and Tazzie. John has always brought a dog to work, so when Laura came on board to run STOP Handgun Violence (an advocacy group John started), Tazzie was part of the package. As a gun owning skeet shooter, John started SHV in ‘95 with the late Michael Kennedy (son of RFK). After Michael’s death, Vickie (wife of the late Ted Kennedy) asked to take his place. John says Mass. has the most comprehensive gun violence protection and the fewest gun fatalities after Hawaii.
John (center) and his in-house counsel Jerry Belair (on his left) met last week with a URS team seeking to manage construction for Fenway Center. Work on the $12M MBTA commuter rail stop is slated to start this fall. We snapped Thalia Schlesinger, Scott Bini, and standing Steve Moore, David Tremblay, Chris Watson, and Mathew King. The Architectural Team, and Carlos Zapata Studio, the design architects, are preparing construction drawings. Suffolk Construction is the design/build GC, while J.F. White is the civil contractor. John plans to get a guaranteed construction price for Phase I this summer. Including all the planning on the mixed-use project, he says “It took seven years to get into the batter’s box.”
Jerry is Meredith’s point man for solar energy projects. Here they’re holding pics of solar arrays installed in December atop Meredith’s HQ and some of its other properties: an office building in Springfield and rental apartments in Clinton and Ware. The Fenway Center MBTA station and garage will also have solar arrays enabling them to produce more energy than they use. John has championed solar power since the ‘70s, when he also campaigned against nuclear power, an effort he continued on Saturday with an anti-nuke editorial in The Boston Globe.
Where will the prices end up at some of the best office addresses in the Class “A” market?
Hub's Historic High-Rises In 'Fight To The Finish'
Prime Addresses Pitted Against Upstarts
The overall vacancy rate for the Boston office market hovers around 13.5 percent, Colliers Meredith & Grew reports. But some of our best-known skyscrapers, like the Hancock, are struggling to fill much larger blocks of space, a trend likely to have a profound impact on the city’s economy for years to come.
With so much top shelf office space available, why would a major law firm or financial company take a chance on what could very well turn out to be a developer’s pipedream? Indeed, for companies that have long dreamed of setting up shop in one of the city’s elite towers, this is the time to make a move to an established property.
Developers hoping to start construction on a range of new skyscrapers, from the ill-fated Filene’s project to a pair of new towers next to the Rose Kennedy Greenway, can kiss these grandiose plans goodbye for the foreseeable future.
“It is going to be a tough sell for some of them, it really is,” said Vivien Li, head of the Boston Harbor Association and an astute office market observer, of developers pushing plans for yet-to-be-built towers.
Instead, in the midst of one of the worst downturns in generations, we have a fight to the finish between some of Boston’s best-established corporate addresses, like the Hancock, and a pair of relatively new upstarts on the city’s waterfront.
On the surface, the vacancy rate for downtown towers, at 13.3 percent, would appear to be closely tracking that of the overall market, if not a little below, according to Colliers Meredith & Grew.
But look more closely and you see some big blocks at some very well known addresses.
For starters, there’s the Hancock Tower, which, after being sold at a foreclosure auction last year, sports a vacancy rate that now hovers in the low 20s. Along with the 60th floor, there’s space available on the 20th, 21st and 22nd floors, as well as the 19th and 10th floors.
Just down the street, the vacancy rate at 500 Boylston St. puts the Hancock to shame. Nearly half the 1980s tower is available, including a huge, 150,000-square-foot block of space being sublet by publisher Houghton Mifflin.
Over in the Financial District, prominent towers also have gaping holes to fill.
There’s 200,000 square feet of empty offices over at 100 Federal St., where Bank of America has its regional operations. A couple hundred thousand square feet is also available at both 99 and 100 High St.
And if Don Chiofaro’s International Place towers seem to be doing a little better than most right now, sporting a 14.2 percent vacancy rate at One International Place, just wait a few months. Ropes & Gray is slated to vacate 350,000 square feet in the tower, moving over to the top floors of the Prudential building.
And as if the competition for tenants weren’t already fierce enough, two upstart high-rises on Boston’s waterfront are now entering the fray.
New Kids On The Block
Waterfront builder Joe Fallon is rolling out the first high-rise at the long-delayed Fan Pier project, with anchor law firm Fish & Richardson committed to 124,000 square feet. Not bad in a down market.
But that leaves another 376,000 square feet of space to fill in the 18-story building at One Marina Park Drive.
For its part, Boston Properties has managed to get the new Russia Wharf tower financed and built amid the worst downturn in generations.
But even after a lease to anchor tenant Wellington Management that will fill more than half the new tower, our vaunted hometown real estate giant still has another 300,000 square feet to rent.
Fan Pier and Russia Wharf bring to the market a pair of ultra modern high-rises in a city where most of the skyline is decades old. There’s the additional attraction of breathtaking harbor views, and, in the case of Fan Pier, plans for a new neighborhood of shops, restaurants and homes.
But there’s a price to be paid for new construction as well, a cost that may be hard for some firms to justify right now. Towers that are already established are going to have more price flexibility than a brand new tower with an expensive debt load to service and even more space to fill.
Say Hello To 2020
So where does that leave all those developers still hoping to make a big mark on the city’s skyline?
Well, to be blunt, it leaves them looking at a construction launch of 2020 – if that.
Tough times have never deterred Chiofaro, who opened up his twin tower International Place complex amid the brutal real estate downturn of the early 1990s.
But it’s not clear where Chiofaro will find the tenants to fill the new pair of twin towers he would like to a build a few blocks away on the site of the current Harbor Garage, overlooking the Greenway. And he will soon be scrambling to fill a huge hole in One International Place after Ropes and Gray waltzes away this year.
And what of poor John Hynes and his beleaguered drive to salvage the Filene’s fiasco and fill in the block he gutted in Downtown Crossing with a new tower?
All that needs to be said is that Fish & Richardson was once slated to go into his Filene’s tower, but is now headed for Fan Pier.
No, there is simply too much space to fill – and top shelf space at that – for any towers still sitting on the drawing boards to have a fighting chance right now.
“Who is going to go into these offices and all these fancy condos they are talking about?” Li asks. “Where is the absorption going to come from?”
But the emerging duel between establish, marquee addresses and new, chic upstarts will be interesting. Let the office market wars begin!
Let's go shopping for for new office space. Accordning the the B & T, it is a great time to be a tenat in the marketplace. Don't be caught standing on the sidelines.
"The year ahead is looking brighter for tenants looking for office space in Greater Boston, according to new report.
Boston's total office vacancy rose to 17.4 percent in 2009 from 13.9 percent a year ago, according to Jones Lang LaSalle's recent analysis. Occupancy declined steadily in the Cambridge office market through the first half of 2009, ending the year with 534,423 square feet of negative net absorption. For the year, the suburban office market recorded 1.3 million square feet of negative absorption.
The only submarket to record occupancy gains for the year was the Northwest submarket. A recovery in the Boston Suburban market will lag Downtown Boston and Cambridge, JLL predicted.
Greater Boston recorded 3.7 million square feet of negative net absorption in 2009. The second half of the year showed the first signs of the recession easing its grip on the global economy, and the rate of decline eased, according to a report.
"A return to economic growth and an eventual recovery in the job market will slowly work to stabilize the office market, but conditions will remain tenant favorable throughout 2010," the report found."
Boston’s central business district has earned the unfortunate distinction as the most deflated rental market in all of the Americas1. Combine that with a lackluster economic recovery characterized by problematic job growth will hamper the pace of any real estate market resurgence, which probably cannot gain much traction until late 2011 or 20122.
What does this mean for you and how do you capitalize on it? Landlords are working extremely hard to preserve market rents on renewals and new leases. Yes, those numbers have come down significantly, but more so then that, tenant improvement allowance (T/I) and rental concessions are two buckets that deserve far more play. When one thinks about cost of space PSF, it should be that of net effective basis. Meaning the asking price less the free rent, example a 60 month lease @ $35.00 PSF with 6 months free is $32.50. Rent abatement was not an available option for tenants 24 months ago, now it has become main stream. The amount depends on the financial viability of the tenant to perform as well the landlord’s competitiveness in the marketplace.
Tenant improvement allowance in the recent past never moved above 50% of the first years rent on a standard lease term. Now, we are seeing that number grow from 65% to 110% of the first years rent. In many cases in times past tenants would have to pay to move into their new space. Nowadays tenants are getting the benefit of turnkey deals, thus no out of pocket expense.
Why hire a broker if I plan to renew my lease? My landlord and I have a workable relationship. Your landlord profits by getting the highest rent possible from you. Until your broker creates competition with your landlord, you’re a captive Tenant exposed to paying above market.
The call to action is to seek out professional advice to assist you in these tumultuous times. To learn more about how the Boston Realty Advisors commercial leasing team can help your business, please do not hesitate to contact us.
William H. Catlin, Jr. • Principal
Boston Realty Advisors
715 Boylston Street • Boston MA 02116
T 617.850.9606 • F 877.868.1672
Boston • New York
1 Boston Business Journal – 12.1.2009
2 Emerging Trends in Real Estate 2020 – PricewaterhouseCoopers
Congratulations to the New Orleans Saints for winning their first Superbowl last night. While Peyton Manning performed well for the Colts, the 74 yard interception touchdown by Traci Porter clinched the game for the Saints, 31-17. Sorry, Dan Shaughnessy.
Back to real estate, I hope you enjoy my Year-End East Cambridge/Kendall Sqaure Office Space Report, featured below.