GI Partners Acquires 103K SF Fort Point Office, Plans Lab Conversion

Courtesy of JLL
51 Melcher St. In Boston's Fort Point Neighborhood.

More private equity money is flowing into Boston’s life sciences market, this time into a Fort Point warehouse-turned-office.

GI Partners paid $74.6M late last month for 51 Melcher St., a nine-story, 103K SF office building formerly home to tenants including WeWork and an Oracle affiliate. The seller, Zurich Alternative Asset Management, paid $53M in 2014 for the 105-year-old building following a renovation.

The property sits blocks from the Seaport’s main artery, Summer Street, and across South Station, a few minutes’ walk across the Fort Point Channel. The building sits near several large lab projects from industry giants Related, Alexandria Real Estate Equities and newcomer Nan Fung Life Sciences Real Estate.

JLL advised Zurich in the sale and procured California-based GI Partners, which also tapped JLL to source post-acquisition financing. JLL Executive Vice President Ben Hux and Managing Director Patrick Nugent will also lease the space to life sciences tenants on behalf of GI Partners.

A new JLL report cites the Seaport as one of Boston’s top life sciences neighborhoods and cements Boston as the nation’s most mature life sciences cluster due to its deep talent pool and lab supply. The northernmost major metro on the East Coast trails only San Francisco in total venture capital funding in the past two years, and the region receives about 10% of all National Institutes of Health funding.

Boston accounts for 11.3M of the 21.6M SF of lab development nationwide, all of the market's 2021 deliveries are pre-leased, and the 8M SF expected to deliver in 2022 is nearly half pre-leased, according to JLL’s 2021 Life Sciences Real Estate Outlook.

The building is currently 21% leased to an apparel retailer, according to a Newmark release Tuesday afternoon stating its Boston Capital Markets Group represented Zurich in the 51 Melcher St. transaction. A spokesperson didn’t immediately respond to a request for comment confirming Newmark’s role in the transaction.

A JLL spokesperson said the transaction was a JLL deal “top to bottom."

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