First Phase Of Boston Power Plant Redevelopment Secures Design Approval, Financing
Developers expect to begin construction later this year on the first phase of the 1.7M SF redevelopment of a South Boston Power Plant after securing the final design approval this week.
The Boston Civic Design Commission unanimously approved the phase, a 754K SF project that includes two new life sciences buildings on the waterfront and the redevelopment of three structures on the power plant site into retail.
A partnership of Hilco Redevelopment Partners and Redgate is leading the redevelopment of the 15-acre former Edison power plant at the corner of Summer Street and East First Street. The plant was built in 1898 and decommissioned in 2006.
Melissa Schrock, executive vice president of Hilco, told Bisnow the first phase has received financing through limited partners and debt. She declined to share further details on the financing but said the project is on track to break ground later this year.
“We were thrilled to get a unanimous supporting vote from the BCDC commissioners," Schrock said. "We started that process back in August and felt that we got some valuable input from them and staff and made some strategic modifications and improvements.”
Like other projects that go through the Article 80 process, the development team went through multiple BCDC and subcommittee meetings before finalizing the design. The developers met with BCDC for the first time in August and have had four subcommittee meetings since December. This sixth meeting was the final one for this phase of the project.
Hilco and Redgate won Boston Planning & Development Agency approval in January 2021 for the overall site plan. The plan calls for 1.7M SF of lab, retail, housing, a hotel and open space. The joint venture bought the site in April 2016 for $24M from Exelon Corp.
Before construction can begin on the site, however, the old power plant needs to be deconstructed, a process that preserves and reuses pieces of the original site in the new project.
“We are a year into [deconstruction] and it will take a majority of this year as well,” Schrock said. “During that time, we will be watching the economy and looking at what tenants are doing and what their demands are, and we will assess as we go.”
Although the team secured financing for the first phase, she said that it will be closely monitoring the economic situation as the project inches along. The market has become more volatile since the Federal Reserve began aggressively hiking interest rates last year, and some projects have been put on hold.
"The financing landscape has become much more complex and complicated in the last nine months, and I expect it will continue to be that way for some time," she said.
The construction process hasn't been all smooth sailing.
In May, a partial building collapse on the site sent three construction workers to the hospital. The collapse led to a halt in work for two weeks, and the federal government in November ordered the project's contractors to pay $600K in fines.
Schrock said deconstruction should be done before the end of this year, allowing construction to begin on the first phase. Phase 1 construction should be complete in the next two to three years, paving the way for the next phase, which is planned to include all of the project's housing and the hotel.
“We are really excited to be making this process and advancing this project forward,” Schrock said.