North Point: New Neighborhood Rising
For his new company’s first ground-up development, HYM managing partner Tom O’Brien and his team took over the stalled $2B North Point project. The task: build a new neighborhood. (That's how you can tell they play Sim City instead of Monopoly.)
Straddling Boston, Cambridge, and Somerville, North Point sits on the site of a former rail yard, on the outskirts of the hot East Cambridge development market. In ‘03, the original development team—an affiliate of the Boston & Maine Railroad and Spaulding & Slye—won approval to build 3M SF of residential and 2.2M SF of office and retail. Smacked by lawsuits, then slammed again by the recession, that team built 340 condos in two buildings, then sold the project. (Stress is a killer, who needs it?) Now, HYM is building a 355-unit apartment tower. Topped off a few weeks ago, Tom expects first occupancy next summer.
Tom’s eager to get HYM’s building completed and almost as excited that in June Education First will start to occupy its new $125M, 300k SF HQ. In the North Point neighborhood (but not on HYM’s site), the build-to-suit office designed by Swedish starchitect Gert Wingårdh features a geometric glazed waterfall that slices through the façade, a reference to the nearby Charles River and the Zakim Bridge in the background. In its expansion from its current 250k SF building nearby, the for-profit Swedish education, language, and travel firm will bring in more highly skilled, well-paid young workers. (Lycka till!)
That’s a huge plus for HYM’s 20/20 (above) where a 450 SF studio is likely to rent for about $2,300/month and a 1,300 SF three-bedroom for $6,000/month. Based on the sale of the original North Point condos (all sold out) and lease-up of neighboring buildings, Tom is optimistic that 20/20 will attract the “classic East Cambridge” tenant who works in life science, technology, and may have an MIT connection. HYM’s partner in North Point is Canyon Johnson.
HYM project coordinator Tracey Plunkett shows us some of the North Point development’s unique features. It has a park that’s open to the public and links to the green space along the Charles River and the Minute Man bike trail. (Those Minute Men wish they had bicycles... would've made things a lot easier.) For those favoring more retail-oriented activities, it’s just a couple of blocks from the Cambridgeside galleria. The building will have a full-size half basketball court. Tom was a football player himself, but is sure that the b-ball court will appeal to young, prospective tenants.
This is one of the original North Point condo buildings where units are now selling for $800/SF. Tom says HYM’s next building may be another condo project since the market is very strong, especially if HYM can get into construction quickly. Also, the East Cambridge office market is virtually full. Rents for new, Class-A space are hitting an “unprecedented” $80/SF, so HYM’s next building may be an office/lab, either build-to-suit or on spec. Certainly, Tom says, it’s time to build.
Just two blocks away at 22 Water St, Behringer Harvard and Wood Partners are building a 15-story, 392-unit apartment building. The top tier units are scheduled for completion early next year. A prime attraction is that the Lechmere Green Line relocation will put the new stop adjacent to Water Street's future front door. (If you're sitting in traffic reading this right now you know how important that is... and you shouldn't be reading this while driving.) In ’12, Behringer Harvard Multifamily REIT I chipped in $103M in equity capital and purchased the 2.4-acre site for $23.1 M from Catamount Management.
Also underway in the neighborhood, AvalonBay is building a 103-unit, loft-style rental building. The adaptive reuse of a historic industrial building, the new lofts will have contemporary features—quartz countertops, stainless steel appliances—and resident access to the pool, clubhouse, and other amenities at AvalonBay’s adjacent tower, where rents reach $6,000/month for a three-bedroom apartment.