Industrial Developer To Start Construction This Month On Spec Project In Malden
An industrial developer known for building urban warehouses in New York City is now planning a new project in Malden, a city just outside of Boston.
DH Property Holdings has acquired a 5-acre property at 735 Broadway St. where it plans to build a 94K SF project, the developer told Bisnow. It aims to complete the project by Q2 2023.
The project, expected to cost $55M, is a joint venture between DHPH and Boston-based developer Pugh Management. Demolition and construction of the speculative development is set to start in May.
Having found buildable land in Malden, DHPH was attracted to the space, as it is one of only three industrial properties within a 10-mile radius of Boston Logan International Airport and Downtown Boston.
“The ability to partner on a project that was shovel-ready, within 10 miles of Logan Airport and inside the urban core of Boston, was very attractive to us," DHPH Executive Vice President Aaron Malizky told Bisnow.
Larger speculative builds have trended upward in the past quarter, as developers are trying to meet the high demands of tenants. However, with the supply shortage of buildable land in the metro Boston area, many developers have turned to office-to-industrial conversions and other nontraditional builds, according to Newmark’s Q1 Boston Industrial Market report.
The new construction pipeline is especially thin in the areas closer to Boston. Newmark's report says the region's urban submarket, which includes Malden and other close-in cities, had 400K SF of industrial under construction at the end of last quarter, and its 22.5M SF of total inventory had a 4.2% vacancy rate. The North and South submarkets, representing farther suburbs, had 4.1M SF and 1.5M SF under construction, respectively.
DHPH’s history spans the Northeast region, but it is best known for its urban industrial projects in New York City, including multistory warehouses. Recently, the company has expanded to other markets like Boston and Philadelphia as New York has become more competitive, and it is looking at some West Coast markets.
"We're only looking to go to the major cities, which by their very nature were constrained," DHPH founding principal Dov Hertz told Bisnow in March. "So it was sort of always looking for the needle in the haystack.”
This is DHPH’s third acquisition in the Boston area, including a 200K SF building in Lawrence that is fully leased, and a 60K SF building in Avon that is currently marketed for lease. DHPH’s Boston portfolio totals $107M and 362K SF. This newest development is the first asset in the firm’s newly launched fund, DHPH IDF I LP.
“We are excited about this project and are looking forward to finding other urban infill projects in the core of Boston,” Malizky said. “We hope this is not our only project.”