As the commercial real estate market nears the halfway point of 2004, investment sales activity is being bolstered by an Indiana firm’s commitment to acquire a swath of office buildings in Boston’s Fort Point Channel district. According to industry sources, HDG Mansur Group will pay more than $85 million for the portfolio, with a long-term lease to Thomson Financial Co. deemed critical to investor interest in the properties.
“It’s a big number,” opined one source, who estimated that HDG Mansur will pay between $86 million and $88 million for the package. Located on Thomson Place and Farnsworth Street, the 10 buildings total approximately 500,000 square feet, with Thomson occupying just over 380,000 square feet after striking a long-term agreement last year with owner Boston Wharf Co. Toronto-based Thomson has been in Fort Point Channel since the early 1980s and today employs more than 1,000 people in that district. The lease extension runs until 2014.
Boston Wharf Co. President Robert N. Kenney did not respond to inquiries regarding the sale, which is being brokered by Meredith & Grew Oncor. Calls to M&G Executive Vice Presidents Lisa M. Campoli and Keven C. Phelan were not returned by deadline, while a spokeswoman for HDG Mansur in the firm’s Indianapolis headquarters said she was unfamiliar with the transaction. Despite that, sources insisted HDG Mansur has emerged as the winning bidder, outpacing several other competitors vying for the buildings, mostly former brick warehouses and industrial structures converted to office space in the 1980s and 1990s.
The Thomson acquisition would be HDG Mansur’s first in Greater Boston. Catering largely to high-net-worth individuals and some institutions, the advisory and investment firm also has offices in New York City and London, said the spokeswoman, Tiffany Gerber, who could not say whether HDG Mansur has plans to pursue other real estate opportunities in the Bay State.
The 10 properties being acquired by HDG Mansur are part of a portfolio of Boston Wharf Co. buildings that went up for sale last year. Tishman Speyer Properties of New York had the larger package under agreement at one point, but opted to bail out in the final stages of negotiations for reasons it never explained. That assemblage contained nearly four dozen buildings throughout Fort Point Channel and would have sold for more than $400 million had the deal been completed.
Boston Wharf has been active in Fort Point Channel since the 1830s, and rose to become the dominant landlord there, but its presence would have been virtually eliminated had Tishman Speyer ultimately stepped forward. Even so, Boston Wharf has downsized its holdings in recent years, most dramatically when it sold off a significant block of properties along A Street to Beacon Capital Partners several years ago.
As for the HDG Mansur deal, one broker familiar with the properties expressed surprise at the rate reportedly being achieved. “It’s a great price for the seller,” said the broker, who attributed it to “a lot of people out there with aggressive capital.”
