Developers are proposing more than 1 million square feet of commercial development in Allston, including the Nexus at Allston Innovation Corridor on Western Avenue. Image courtesy of King Street Properties.
Harvard University is in full-bore development mode on one side of Allston, and New Balance established an office and lab cluster served by a brand-new commuter rail station on another.
Between the two lie hundreds of acres sought by developers for lab, office and housing projects. The Boston Planning and Development Agency currently is reviewing proposals for more than 1,500 apartments and condominiums, and over 1 million square feet of commercial space in Allston.
As development spreads toward the Watertown line and across it, the BPDA is rethinking the zoning rules for a large portion of Lower Allston. Next month, it kicks off a planning study with the intent of rezoning the Western Avenue corridor for higher densities.
“The [development] proposals are contemplating more density than is allowed under the existing zoning, and we think more density is appropriate for the corridor,” said Gerald Autler, senior project manager for the BPDA.
A map of the study area was not available when Banker & Tradesman went to press, but it will encompass Western Avenue from Barry’s Corner to Leo Birmingham Parkway, sections of Soldiers Field Road and a long-delayed development site on Lincoln Street owned by Harvard, according to the BPDA.
Most of the area is currently zoned for floor area ratios of 1.75, requiring large-scale projects to seek zoning variances for additional density. The rezoning would give better predictability to investors and could ratchet up bidding wars on prime parcels.
An initial community meeting on the Western Avenue planning study will be scheduled in September, with the goal of bringing zoning changes to the BPDA board for approval next spring.
Map data © Open Street Map contributors / CC BY-SA 2.0
Lab Developers Willing to Pay the Most
The success of Boston Landing – which leased brand-new lab space to Roche Diagnostics, incubator SmartLabs and Proteostasis Therapeutics in 2017 – put Allston on the map as a budding life science cluster. And life science developers have begun to outbid multifamily competitors for development sites, said Christopher Sower, a senior vice president at Colliers International in Boston.
“What we’re seeing in the land market in general is [that] if the lab developers are seeing the viability of it, they are definitely outpacing where the residential values are,” he said. “Typically, multifamily was the highest price per foot, and now the lab guys are moving past that and can almost pay double what a residential developer can pay.”
Colliers is currently marketing The Welch Corp.’s 3-acre property at 35 Electric Ave. as a redevelopment opportunity.
King Street Properties and Mugar Enterprises are proposing a large, mixed-use complex including more than 500,000 square feet of office and lab space at the Stadium Auto Body property and surrounding parcels on Western Avenue.
The project would expand a tech cluster that started to emerge as Harvard gained approval last year for its 900,000-square-foot Enterprise Research Campus on 14 acres at 125 Western Ave. The university in June issued a request for proposals from developers for a mixed-use complex, with the goal of selecting a partner by December.
Tony Hayes, a first vice president in capital markets at CBRE, said life science uses will lead the next wave of development in Allston.
“The transportation and proximity to Cambridge are the two things that make it very desirable for life science, and that’s where there’s the most liquidity on the development financing front at this point in the cycle,” Hayes said.
Allston’s potential for apartment development may have peaked, with oversupply in the offing thanks to projects like Stop & Shop’s 895-unit Allston Yards on Everett Street. Image courtesy of Elkus Manfredi Architects
Harvard, Berkeley Partner on Dormant Site
More development proposals are waiting in the wings, following the acquisition of high-visibility parcels by leading local developers.
The Davis Cos. paid over $26 million for The Skating Club of Boston’s 2-acre property at 1240 Soldiers Field Road in March. No development plans have been submitted yet. The parcel borders Davis Cos.’ Studio Allston boutique hotel, which opened in 2018 and is a short walk from its Telford 180 condo complex, also completed last year.
Harvard is partnering with Berkeley Investments to resuscitate the long-stalled, 450,000-square-foot complex overlooking the Massachusetts Turnpike at 176 Lincoln St. The property was unsuccessfully marketed as a telecom facility by developer Cabot, Cabot & Forbes before Harvard bought it for $16 million in 2006.
Berkeley Investments is drawing up plans for a mixed-use development, President Young Park said in a statement. The company will notify BPDA of its preliminary plans in late summer.
The BPDA’s Autler said the timing of the planning study is not driven by any specific projects, however.
“We’re not zoning to enable these projects,” Autler said. “We’re rezoning as a responsible zoning exercise. [Developers] could certainly approach the ZBA, but I’m not sure they would support that and I don’t know that they would get neighborhood support.”
Rental Market May Have Peaked
Mount Vernon Co. was the first developer to test new multifamily construction in Allston during this real estate cycle with its Green District project on Brainerd Road. And in June, it completed a $38 million apartment complex called Radius at 530 Western Ave. The complex is currently 90 percent leased with rents topping $4 a square foot, Mount Vernon Chairman Bruce Percelay said.
Percelay described the lease-up as successful, but said Allston’s potential for apartment development may have peaked, with oversupply looming. Two large projects are working their way through BPDA permitting: Stop & Shop’s 895-unit Allston Yards on Everett Street, and City Realty’s 341-unit Allston Square on Cambridge Street.
Steve Adams
“While our absorption is good, we’re starting to get a sense that when one developer puts concessions in to accelerate leasing, it ricochets back to us,” Percelay said. “That, to me, is a sign we’re starting to get to a point where supply is going to be a market issue.”
That’s not to say that Percelay is bearish on Allston, where his company relocated its headquarters from Back Bay in 2017. In a partnership with National Development, Mount Vernon is preparing redevelopment plans for the 8-acre WBZ-TV property on Soldiers Field Road, including an office component.
“Western Avenue is one of the last frontiers,” he said. “It has taken a long time for developers to recognize what a strategic location it is. In 10 years, Western Avenue will be unrecognizable.”
