of 2016
CONGRATULATIONS TO OUR WINNERS! See this year’s results, B1.
Est ab li s h e d 1 8 7 2
the
financial
www.bankerandtradesman.com
WEEK OF MONDAY, OCTOBER 10, 2016
services
and
real
estate
weekly
for
massachusetts
A Publication of The Warren Group COMMERCIAL INTERESTS
UMass Boston In Midst Of Overdue Renovations Original Campus Construction Was Criminal – Literally BY SCOTT VAN VOORHIS BANKER & TRADESMAN COLUMNIST
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ribes and kickbacks. That’s just how public construction projects were divvied up in Massachusetts until the blockbuster Ward Commission report blew the lid off in 1980. And exhibit No. 1 was the bidding and construction of the UMass Boston’s harbor campus, in which a crooked contractor delivered a cruel parody of plans for a world-class public university campus. When it opened in 1974, the new campus overlooking Dorchester Bay was a far, far cry from the futuristic university where students arrived by monorail, as some professors had dreamed. Instead, contractors who had bribed their way into the job of overseeing the construction of the harbor side campus delivered a jumble of crumbling red brick buildings that had the look, to the more cynical, of a medium-security penitentiary. Continued on Page 3
MOVING ZONE
Change Is On The Way In Back Bay Big Blocks Of Space Set To Hit Market
CONDO CONVERSIONS
MULTIFAMILY HOME CONVERSIONS SLOWLY PICKING UP IN MEDFORD
The Market Doesn’t Quite Bear The Cost, But Change Is Coming BY JIM MORRISON BANKER & TRADESMAN STAFF
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veryone knows Somerville’s rags-to-riches story: Multifamily houses in that scrappy, working-class town were gradually bought up by developers who turned them into condominiums and sold them off to yuppies who’d been priced out of Cambridge. Now that the median sale price of a Somerville condo is just shy of $600,000, where will budget-conscious buyers go next? According to data from The War-
BY STEVE ADAMS BANKER & TRADESMAN STAFF
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ack Bay has some of Boston’s most architecturally distinct landmarks and picturesque streets –and the city’s highest office rents to match. An upcoming exodus of major tenants will force landlords to get creative finding their replacements. Approximately 800,000 square feet of direct space will become available in the next 12 months as Wells Fargo, Houghton Mifflin Harcourt, Natixis Global Asset Management and Partners Healthcare vacate Back Bay buildings. “You can go back two decades and we’ve never had a spike in vacancy of any sort in the Back Bay,” said Brendan Carroll, director of intelligence for Bostonbased Encompass Real Estate Strategy. “Now all of a sudden, we’re starting to see some options.” As of Sept. 30, Back Bay had the highest Continued on Page 9
Somerville Medford Malden
ren Group, publisher of Banker & Tradesman, there are 4,516 multifamily homes in Medford and 4,101 in Malden just waiting to be renovated, turned into condos and sold to Millennials. What are developers waiting for? These renovations have already begun in the southwestern corner of Medford, especially on the streets closest to Tufts University. They’re just not catching on in the rest of town yet. Tom Cafarella, of Ocean City Development, said the reason is mostly mathematical. “It’s pretty simple,” Cafarella said.
“Most of those houses are over 100 years old. It can cost $300,000 to do the renovation and conversion because you have to replace everything. The [construction] costs are exactly the same regardless of where the property is, and the resale value just isn’t there in Medford yet.” Through August, 90 two-family homes have sold in Medford at a median price of $615,000. Add another $300,000 to renovate the building and turn them into condos that real estate agents say will likely sell somewhere in Continued on Page 10
2-Family
Condo
$785,000 $615,000 $475,750
$581,000 $425,000 $265,000
All median sales figures are year to date through August. Source: The Warren Group
CONTENTS Points ����������������������������������������������������������������������� 4
Commercial & Industrial ������������������������������������������ 9
Classified Sections ������������������������������������������������� 13
By The Numbers ������������������������������������������������������� 6
Residential ������������������������������������������������������������ 10
Banker & Tradesman’s Best of 2016 ���������������������� B1
In Person ������������������������������������������������������������������ 7
Banking & Lending ������������������������������������������������ 12
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