The Allston-based Hamilton Co. may convert soon-to-be purchased properties in Boston and Quincy into condominiums, just as the owner of the Museum Towers apartments in Cambridge (above) did last year.
Continuing a trend of multifamily sales activity in Greater Boston, the Hamilton Co. of Allston is preparing to acquire two more residential properties, including 12 Stoneholm St. in the Hub’s Fenway/Symphony district. The prominent 120-unit complex is expected to trade for $26 million, or about $215,000 per unit.
“We do have it under agreement,” Hamilton Co. President Carl Valeri confirmed to Banker & Tradesman last week. While Valeri declined to offer specific details, observers said it is anticipated the units will be converted into condominiums, a path that Hamilton is also expected to pursue in its other deal, that being the $31 million purchase of the Bayshore Apartments in Quincy.
The latter transaction is expected to be completed this week, while 12 Stoneholm St. is slated to close by year’s end, according to sources. The seller of the Boston property is Atlantic Southborough Realty, a MetroWest-based company that paid $7.3 million for the building in 1996. According to observers, 12 Stoneholm St. should be well received by prospective condominium buyers, with features including 24-hour security, on-site parking, a rooftop pool and a centralized location near Fenway Park, the Longwood Medical Area, and the city’s bustling Back Bay district.
“They should do very well there,” one industry source familiar with the sale said of the Hamilton Co., one of the Boston’s largest residential real estate companies. Cushman & Wakefield of Massachusetts marketed the property on behalf of the sellers, with the team led by Robert E. Griffin Jr., Marci Loeber and Edward C. Maher Jr. Calls to Loeber and Atlantic Southborough Realty officials were not returned by press deadline. If the conversion plan is undertaken, it would mimic similar strategies seen in other recent multifamily sales, headlined by the $145 million purchase of the Museum Towers apartments in Cambridge last year by a Florida firm. The company is now marketing units in the second of the twin-tower complex, which is located near the Lechmere Green Line station on the Boston/Cambridge border.
A Significant Spree
Cushman & Wakefield has been one of the few brokerage firms peddling multifamily properties that are expected to remain as rental operations. After several weeks of negotiations, for example, Archstone-Smith reportedly has committed to the Village at Quarry Hills in Quincy, a townhouse apartment community being developed by the Finger Cos. While paying a hefty price for the assets, about $340,000 per unit, Archstone-Smith will reportedly not convert the complex, which is in the midst of construction. According to one source, the price being paid was competitive with several bidders who were considering a conversion, but the buyers were ostensibly willing to pay a premium as part of a desire to establish a presence in the community. Calls to Archstone-Smith officials were not returned, but sources claimed the agreement with the Finger Cos. has been finalized.
The Bayshore Apartments feature 170 units, and Hamilton is expected to conduct capital improvements to the property to make it more amenable to condominium buyers. It is unclear whether any money will be required to position 12 Stoneholm St., or what Hamilton expects to reap in terms of unit pricing, but one estimate put the range between $250,000 and $500,000, or about midstream for the city’s white-hot condominium climate.
Although Valeri would not discuss specific transactions, he did acknowledge that the Hamilton Co. is on a significant acquisition spree, even stepping up its investment track in 2005 after several active years. Hamilton spent about $76 million last year, primarily on multifamily assets, but could reach the $100 million mark in 2005, with several other opportunities said to be on the firm’s radar screen as the final quarter of 2005 takes hold. According to Griffin, Cushman & Wakefield’s Financial Services Group has sold about $1.4 billion of product to date, and is headed for a second straight year above $2 billion, including several major apartment deals. The company also brokered the sale of Longview Place in Waltham to Equity Residential, with that property also expected to stay as rental.
CBRE/Whittier Partners is enjoying a solid year on the multifamily sales front as well, just last week closing on a 103-unit Class B apartment complex in Brockton that traded for $13 million. BH Boulders LP acquired the Boulders, which features eight two-story buildings originally constructed in 1974 and renovated in 2000. Efforts to contact the owners and CBRE/Whittier brokers Simon J. Butler and Biria St. John were unsuccessful, and sources could not say whether the buyers are considering a conversion or plan to retain the property as rental.
Butler and St. John are also involved in a major apartment sale in Boston, in which the Radco Cos. of Atlanta has agreed to buy Longwood Towers in Brookline. The deal, said to be in the $110 million range, would equate to more than $400,000 per unit for the 268-unit property, making it one of the priciest sales ever for that product type in the metropolitan Boston market. Although Radco Co. founder Norman Radow has previously confirmed to Banker & Tradesman that his firm has Longwood Towers under agreement, with a closing anticipated for mid-October, he has yet to say whether a conversion is the strategy for Longwood Towers.
Despite Radow’s silence on the matter, observers said the pricing indicates a conversion is the likely plan, and one source familiar with the deal estimated that the units will trade between $600,000 and $1 million. Radco made its initial foray into Boston two years ago when it acquired the 62-unit Tremont Tower in the downtown district, later selling some units for upward of $4 million.
