Call it an outgrowth of growth. With Boston’s economy bursting at the seams, areas of the city traditionally reserved for residential and retail uses are suddenly being eyed as viable destinations for office uses, a trend which in some cases is fomenting brand-new construction, while in others, developers are seeking to convert existing structures into modern uses.
The latter is the case in South Boston, where Pappas Industrial Parks is belying its name with the renovation of the Court Square Press building into 211,000 square feet of first-class office space. The hulking property, abandoned since the early 1990s, is in the midst of a major overhaul which promises to breathe a new element of life into the Broadway business district.
“It’s a good address,” company principal James Pappas said last week. “You really can’t beat it.”
Pappas, whose firm is based in South Boston, said he has been pursuing the property for several years, always thinking it had the right fundamentals to serve as an office building. Located across from the MBTA’s Red Line, the building provides direct public transit into downtown Boston and Cambridge. It also offers commanding views of the Hub skyline from the south, and is adjacent to Interstate 93, with quick access to the Massachusetts Turnpike as well.
“There isn’t anyplace you can’t get to from there,” Pappas said.
Trammell Crow principal John P. Barry concurs with that outlook. Barry, leasing agent for the property, said tenants who have toured the development marvel at the proximity to the subway line, and are enthused by the ability to have a Boston address at a fraction of the rates being achieved in more established markets such as the Financial District and the Back Bay. Indeed, although Pappas has long been enamored with the development, the sudden surge in office rents this past year appears to make the project even more promising.
“It’s definitely a function of the marketplace,” said Pappas. “If the downtown market was $25 to $30 per square foot, we would have a very difficult time undertaking this kind of project.”
As it is, however, tenants who are seeing their rental rates double as their termination date nears are suddenly scrambling to look for close-in alternatives. Although the owners initially sought companies that could take over the entire building, and would still welcome such a user, Barry said it appears the biggest demand could come from tenants in the 50,000- to 70,000-square-foot range, including those that must keep a tight rein on the bottom line.
“Now more than ever, tenants need to make smart real estate decisions, and this is a good value alternative,” said Barry. “It has been very well received so far.”
Compared to achieved rents of $89 per square foot in downtown Boston, the Court Square Press building is being marketed at the $40 per-square-foot level, Barry said, adding there is also a tenant improvement allowance in the low to high $20 per-square-foot range. Floorplates of 35,000 square feet will also provide the flexibility many companies today are seeking, Barry added.
Among the financial and access attractions, Barry said, are the building’s brick-and-beam environment, generous parking ratios and abundant natural light that will flow from more than 700 large windows. The designers, John Cunningham Architects, have included a dramatic two-story glass atrium that will serve as the building’s entrance, while an inner courtyard will provide a bright common area aimed at encouraging interaction amongst the office tenants.
“When the front goes on that building, it will establish it as one of the really great second-market office buildings in the area,” Pappas said.
Work is currently underway on both the interior areas and in creating the glass entrance, with Barry estimating that the project will be ready for occupancy late next summer. Shawmut Design & Construction is serving as general contractor on the project, while David M. Berg Assoc. of Needham is performing structural engineering services.
Brighton Idea
Meanwhile, across town in North Brighton, BV Development Assoc. is moving along with another new infill office project, the Brighton Landing complex overlooking the Massachusetts Turnpike extension. Last week, for example, the New Balance Shoe Co. officially moved into five floors at the first of two buildings to be constructed on the site, while leasing broker Mark J. Winters of Cushman & Wakefield said the project has just scored two more tenants.
The larger of the two firms, Lexington-based Provant, will take 18,000 square feet in the second building, to be known as the West Building. That property, slated for completion in May, also has a 16,000-square-foot commitment from Vantage Partners, a Cambridge consulting firm. The 400,000-square-foot project is now 65 percent pre-leased, according to Winters.
Even with a recent dropoff in tenant demand, fueled partly by the high-tech industry’s recent woes on Wall Street, Winters said Brighton Landing continues to generate interest, and predicted more deals will be completed in the short term.
“Overall, demand has slowed a little bit, but we have some good activity right now,” Winters said. “It’s moving along well.”
