EXCLUSIVE: WeWork Leases At Midwood's Refurbished One Milk Street
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WeWork is continuing its Boston expansion by taking the entire office component at a renovated historic building in the heart of Downtown Crossing.
Midwood Investment & Development spent most of 2017 and 2018 doing a gut renovation at One Milk Street, a six-story, mixed-use building it acquired in 2015 for $18.2M. The development team restored all the interior architecture and exposed brick that dated back as far as the late 1800s.
The work to preserve the historic Boston building caught the attention of the country's fastest-growing office user, as WeWork has signed a lease for the five-story, 29K SF office at the 45K SF building, sources familiar with the deal tell Bisnow.
The Boston Realty Advisors office leasing team of Robert LeClair, Bonny Doorakian and Wil Catlin represented Midwood in the deal. They declined to comment.
The building had been put on the market in summer 2018, prior to the completion of the extensive renovation.
One Milk is less than a 10-minute walk from South Station as well as the Downtown Crossing and Park Street subway stations. The neighborhood has a burgeoning tech scene, as growing firms have taken space vacated by large law firms and financial institutions moving to newer product in places like the Seaport.
The neighborhood tenant shift is also driving much of WeWork’s local expansion.
The coworking company has offices at 33 Arch St., One Beacon Street and 745 Atlantic Ave. as well as ones planned for One Milk Street, 711 Atlantic Ave. and a 250K SF commitment at 1 Lincoln St., which is expected to include Salesforce as a tenant.
It is unclear what tenant strategy WeWork has for One Milk Street, but the coworking giant included Boston earlier this year on a list of cities where it plans to expand its reach of flexible office offerings for midsized companies that have grown out of coworking.
Midwood had been asking for rents in the low $60s/SF at One Milk Street Class-B downtown rents tend to run in the mid-$50s/SF, according to brokerage data.
With its latest deal, WeWork’s local footprint spans nearly 1.1M SF, according to Perry Director of Intelligence Brendan Carroll. That puts it close to John Hancock and Fidelity on the list of Boston's biggest users of office space.
As for Midwood, it isn’t expected to stop its downtown restoration work with One Milk. The team has a local portfolio that includes One Bromfield, where the developer previously proposed a 59-story residential tower in 2016 but is expected to revise those earlier plans.