Not long ago, if someone claimed Boston’s Downtown Crossing neighborhood would be a hotbed for real estate investment activity, they’d be seen as pretty clueless. And that’s probably putting it kindly.

But now, major apartment and mixed-use projects are planned or underway in the area, local and national investors are scooping up properties, and retailers and restaurants now occupy more than 250,000 square feet of retail space that lay vacant four years ago.

“Clearly there’s a tremendous amount of momentum in Downtown Crossing after a quiet period where it was not on people’s radar screens,” said Christopher Angelone, executive vice president on CB Richard Ellis/New England’s capital markets team, which is marketing 59 Temple Place for sale in the neighborhood by Northland Investment Corp. “Look at Washington Street. You have a lot of buildings that are vacant or partially vacant in an area of the city with the highest pedestrian count, as well as the best access to transportation. It’s an unbelievable location that everyone has forgotten about because of the unknown of One Franklin. But that has not diminished the value there.”

One Franklin, of course, refers to the project supposed to have been erected over and around the former Filene’s building. The building was largely demolished more than four years ago, but after running out of financing, the work site has sat as a constant reminder of the many projects stalled during the recession.

But unlike others, plans for a mixed-use office, residential and retail tower by former developer Vornado Realty Trust were never restarted. That is, until the city brought in Millennium Partners to take over the project and control an additional 1.2 million square feet of residential, office and retail space in Downtown Crossing.

Behind The Scenes

The firm, developer of the downtown Ritz-Carlton and two other Downtown Crossing projects currently under construction, has agreed to take a controlling stake as developer of the demolished Filene’s site. The project, likely to cost $500 million, is expected to reach 500 to 600 feet in the air and include retail, office space and hundreds of residences. It will still likely be months or a year – at least – before construction starts, largely because of paperwork that still needs to be filed, community meetings and the design alterations that will likely ensue.

But nearby buildings were trading and retail shops filling even before the Millenium deal went public in February.

Last year, Brickman Assoc. bought the roughly 131,000-square-foot property at 38 Chauncy St. for more than $21 million. Synergy Investments & Development purchased the 98,510-square-foot office building at 99 Chauncy St. for about $13 million. To top it off, Invesco paid approximately $130 million for the 150,000-square-foot building at 350 Washington St. that houses retailers T.J. Maxx and Marshalls.

Now, CBRE is marketing 59 Temple Place, a 124,726-square-foot office and retail asset purchased by Northland for $23.5 million in 2007. Sources told Banker & Tradesman that while Northland was hoping to get $25 million for the Class B asset, the more realistic price is somewhere between $21 million and $24 million.

But to some onlookers, the point is not the pricing, but the fact properties in that area are trading at all. Angelone said interest in the 59 Temple property has been “extremely strong.”

There are a number of factors driving the investment interest. The area is between the Back Bay and the Financial District. It has plenty of public transportation options between the MBTA’s Orange, Red, Green and Silver lines. And a lot of investors want to get established there before the potential project at the Filene’s site starts to drive rents up, said Brad Takala, managing director of acquisitions for the Davis Cos., which toured 59 Temple Place but decided against investing there.

In the end, Takala passed on the property, he said, because it’s a dated building and would need a lot of investment of both time and money. But it would be perfect for a local operator that will “live and breathe nothing but this property for the next three years,” he said. Long-Term Bets

CBRE is marketing the 10-story office property, originally built in the 1900s, with the potential to redevelop it into a 122-unit apartment building or a 183-unit boutique hotel. Takala said the lack of parking would make it tough for apartments, and with the high costs associated with operating a hotel, that would not likely work. Given those factors, Takala offered, the site is a natural for student housing.

But investment sales are just one aspect of the Downtown Crossing story. According to the Boston Redevelopment Authority (BRA), 64 new retail or restaurant operations opened in 2010 and 2011 in Downtown Crossing and the immediate areas, with several more to come. Since 2008, retailers have invested more than $44.7 million in the area. And at least a portion of the area’s most glaring vacancy, the hole left after the closure of the downtown Borders bookstore, will be filled by a 25,000-square-foot, “urban concept” Walgreens.

Even so, there are no tenants in sight for the six-years-vacant, almost 70,000-square-foot former Barnes & Noble bookstore at 395 Washington St., owned by Robert Posner. Posner declined to comment for this article.

And according to sources, no tenants are known to be signing on anytime soon for the old Strawberries, a three-story, 12,200-square-foot former music store at 411 Washington St. Same for the former Aldo shoe store at 415 Washington St.

Still, commercial real estate experts have faith in Downtown Crossing’s future. Benjamin Sayles, a director with Holliday Fenoglio Fowler, said Downtown Crossing and the surrounding area is already being validated by the multifamily and office investment occurring there, with investors making long-term bets on the area’s success.