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Developer Pivots Boston Hotel Project To Residential

A rendering of a residential tower at 150 Kneeland St. in Boston.

A developer is pivoting plans for a downtown hotel into a residential tower, citing “seismic shifts” in the hospitality industry and the coronavirus pandemic’s effects on capital markets.

The Hudson Group has nixed its 230-room hotel building and put forward plans for a 115-unit residential project, according to documents filed with the Boston Planning and Development Agency last week. The proposed 22-story structure at 150 Kneeland St. in Boston’s Leather District will remain largely unchanged, according to Hudson’s filing.

“We have been committed to the Leather District for more than 25 years and look forward to continuing that investment at 150 Kneeland St. by providing much needed new housing and neighborhood improvements,” Hudson Group partner Noam Ron said in a statement.

The Hudson Group's industry concerns are well-founded, as hotel bankruptcy cases are starting to increase after months of occupancy far below 50%. While the industry is expected to recover, hotels in dense, urban settings will take years before they reach pre-pandemic revenue levels, experts have said.

The change, quietly introduced at two meetings with the Leather District Neighborhood Association in the past two months, is a rare switch to residential as developers across Boston are increasingly attempting to capture the lively life sciences market. Steps away from The Hudson Group's parcel, Oxford Properties announced in December a switch from office space to accommodate life sciences at 125 Lincoln St.

The 220-foot high-rise at 150 Kneeland St. is expected to span 96K SF and add 20 affordable housing units for those earning between 30% and 50% of the area's median income, project filings said. The site, near Boston’s Chinatown and South Station, will contribute funds to Boston’s Inclusionary Development Policy and Linkage Fees, although developers didn't disclose how much money the site would contribute.

The pivot has received near-unanimous approval from two community groups, according to project filings.