The future is unclear for a portfolio of high-profile properties in Boston’s Seaport District as its owner contemplates selling assets on Congress, Sleeper and A streets.
New York-based Brickman is planning to sell four properties in the red-hot Seaport, sources told Banker & Tradesman.
The buildings up for sale are 300 A St., also known as Harbor Corporate Center; 313 and 330 Congress St.; and 51 Sleeper St. The only building with a pending lease expiration is 330 Congress St, where 3D imaging firm Neoscape will be vacating roughly 13,000 square feet in May.
Brickman purchased 313 and 330 Congress St. for $22.7 million in April of 2006 from New Congress Associates LLC, an affiliate of Edwards Day Property Investments. The are both six-story, brick-and-beam office buildings with 70,217 square feet and 35,811 square feet of space, respectively.
The firm bought 51 Sleeper St. from the Mayo Group in an off-market deal for $45 million in 2007. The 150,000-square-foot building, built in 1929, is a concrete and steel structure, offering a more institutional quality product than the brick and beam buildings that comprise the majority of the Seaport market.
In 2006, Brickman acquired 300 A St., also known as Harbor Corporate Center, from the Archon Group for $23.7 million. The 106,000-square-foot property is home to Elkus Manfredi Architects, among other tenants.
In Demand
The Boston office of Holliday Fenoglio Fowler (HFF) will be selling the properties, expected to come to market within the next two weeks. The buildings will be sold as a portfolio or separately. There is no asking price for the assets, and industry executives said it is too early to know what interested property owners will offer.
Even so, sources told Banker & Tradesman the properties will command between $275 and $300 per square-foot. On the lowest end of that range, the selling price would be around $99.5 million. At the high end, it would be $108.6 million. Rents at the Brickman properties are generally in the mid- to upper-$20 per-square-foot range, substantially below the market, which is currently averaging the mid-$30 per square-foot range, according to sources.
Either way, it is unlikely Brickman would accept bids below the approximately $91.4 million the company paid in total for the properties – especially now that the Seaport district is attracting attention from national and global investors.
Brickman did not return calls seeking comment.
“The seaport is so hot right now in people’s minds that the range of possible buyers is really broad,” one commercial real estate investment expert told Banker & Tradesman. “If the portfolio came out four years ago, the field would be much narrower. But since then it’s become very much a topic of conversation among investors. It’s established itself as a submarket to potential institutional buyers from all over the place, national and even global investors.”
Industry experts said one factor that could come into play for this and other Seaport deals will be Thomson Reuters’ impending decision to renew or relocate from Crosspoint Associates Seaport portfolio, known as Thomson Place.
Reuters’ notice and expiration dates, Dec. 31, 2013 and Dec. 31, 2014, respectively, could strongly impact the Seaport market. If vacated, roughly 350,000 square feet of supply would be added to the market. Although no decision has yet been made, 100,000 square feet of that space is already being subleased in the high teens and low $20s per square-foot.
The pending Brickman portfolio sale does not include the debt on Crosspoint’s Seaport portfolio. Brickman purchased the $91 million debt for approximately $80 million from Anglo Irish.
