What's Up at the Seaport: Part 1
While some big Boston area projects are faltering, the 6.3M SF Seaport Square is gaining momentum. By this summer, it's likely to have eight of its 10 east-west parcels under construction. (So if you're walking in that area, bring headphones.) To Boston Global Investors CEO John Hynes, that’s the tipping point for this 20-building game changer that’s transforming our historic waterfront.
The construction budget is being finalized for the $625M One Seaport Square (832 luxury apartments and 260k SF of retail) being developed by The Berkshire Gp, BGI, and WS Development. By June, construction is slated to start on One Seaport, a new chapel, and a park. (It will be like an updated Clue game board. It was Gp in the chapel with the backhoe.) By year-end, John (a panelist at Bisnow's 3rd annual State of the Seaport event, March 26, at the Renaissance Boston Waterfront Hotel) expects to have half the sites in the 23-acre master plan sold or in construction, which will markedly advance the emergence of the waterfront as a modern mixed-use district. The creation of a new Boston waterfront may seem inevitable now. But last week’s retreat of the private developer from the $1.6B overhaul of Quincy Center makes it clear that building a big new urban neighborhood is rare.
The elements for success are “real estate 101,” John says. They’re: location, location, location, and timing, which no one can really control. (Timing, important in real estate, marriage proposals, and skydiving.) For a developer, “location” means easy vehicular access, reliable public transportation; a vibrant area packed with amenities, well designed buildings with view corridors, that all add-up to a quality lifestyle. Timing is about demographic and economic trends, which have been favorable for the past 24 months. Very few projects can put all the pieces together as Seaport Square is doing. “We're witnessing the emergence of one of the most exciting areas in the City,” he says. Meanwhile, the new Quincy Center project hit an obstacle, and Northpoint in Cambridge/Somerville/ Boston is a long time coming.
Of course, in developing a new mixed-use waterfront, Seaport Square’s size makes it pivotal. It wouldn't be happening without the completion of the Big Dig that made the district directly accessible by car and mass transit, John says. The project has also had some difficult stretches. In ’06, BGI and Morgan Stanley closed on the land but not until 2010 did the developer get final City approvals; it was longer than anticipated, John tells us. Then it took two years to implement the $10M one-acre Q park and public Innovation Center (above) required by city permits. Once the team leaped over that hurdle, the door opened for them to sell or develop sites.
Last year, Norwich Partners started construction on the 136-key Envoy hotel (above). Skanska and Twining Properties broke ground on a 300-unit apartment building and Skanska started a 450k SF office where PwC will relo its Boston HQ. With the December sale of 1.1M SF to Berkshire for One Seaport, Morgan Stanley/BGI has sold 2.5M SF of its 6.3M SF. The priority for 2014, says John, is to sell or develop the remaining parcels (600k SF) in the Seaport Boulevard corridor. The focus for '15: the 3M SF of parcels south of Seaport Boulevard to Congress Street. (If you'd like to learn more about the bustling Seaport, please join us for Bisnow's 3rd annual State of the Seaport event, March 26, at the Renaissance Boston Waterfront Hotel.)