Owners of the 435-unit Museum Towers high-rise apartment complex in Cambridge are reportedly closing in on their selection of a buyer for the property.
The sale of Cambridge’s Museum Towers apartment complex has been narrowed to a handful of finalists, with sources saying the remaining quartet includes the developer who converted Harbor Towers in Boston into condominiums and a high-flying Miami firm that just acquired a nearby apartment building for $24.7 million.
As with other suitors, the latter firm reportedly plans to recast Museum Towers from a luxury apartment property into condominiums, mimicking its strategy for the 104-unit CambridgeSide Apartments. But sources said the company, Crescent Heights Inc., will have to pay over $100,000 more per unit than it did for CambridgeSide, given indications that the twin-building Museum Towers will meet its target price of $148 million.
At that rate, the 435-unit Museum Towers would trade for more than $342,000 per unit vs. about $237,000 per unit that Crescent Heights paid for the CambridgeSide Apartments. “They are right there,” one source said of the pricing goal at Museum Towers, with all of the finalists said to be making offers in that range. The development is owned by ING Clarion, which paid $108 million in 1999 from original developer Dean Stratouly.
Also said to be in the hunt for Museum Towers is Gregory A. Rand of First City Development Corp. The North Shore developer is best known locally for converting Harbor Towers into condominiums back in the 1980s. Located a few miles away from Museum Towers on Boston Harbor, Harbor Towers is similar in that it also consists of two high-rise buildings constructed for an upscale clientele. Efforts to contact Rand and Crescent Heights principal Tomer Bitton were unsuccessful, while ING Clarion Managing Director Mark Weld was unavailable for comment by press deadline.
Among the Converts
Nonetheless, industry sources insisted that both Rand and Crescent Heights have made the short list to buy Museum Towers, with one source predicting that a winner could be selected as early as this week. Besides Cambridge, Crescent Heights has embarked on a national condominium conversion program, with an active presence in Chicago and other major markets. Cushman & Wakefield of New England President Robert E. Griffin Jr. declined to discuss the status of the Museum Towers negotiations when contacted Friday. C&W is brokering the sale of the development on behalf of ING Clarion.
“We’re getting close, but we’re not quite there yet,” said Griffin, although he did acknowledge that the property will sell at or near the asking price. “We’re doing very well with the project,” he said. “We have just had incredible activity on it.”
Griffin would not comment on who remains in the bidding, or even say who else had competed for Museum Towers, although sources claimed that both J.S. Karlton and Lincoln Property Co. had been chasing the asset but are no longer in the running. Calls to both companies were not returned by press deadline.
Plans to convert Museum Towers to condominiums would make it one of the largest such undertakings in the Boston/Cambridge market in recent memory, although there are several similar initiatives currently underway. In addition to CambridgeSide, a luxury apartment development is being converted at the former Charlestown Navy Yard, while J.S. Karlton has reportedly had an encouraging result with its conversion of a six-story apartment complex a few blocks away from Museum Towers. That property at 226 Causeway St. in Boston’s North Station district was developed by Intercontinental Real Estate Corp., which retained an office portion underneath the residential piece.
“It has been moving along very well,” acknowledged Kevin J. Ahearn, whose Otis & Ahearn is brokering the sale of the Causeway Street units for J.S. Karlton at what is now being called Strada234. Only 17 of the 88 units at Strada234 remain available for sale, said Ahearn, even though marketing of the property only began in late 2003.
Some industry observers have balked at the ongoing pace of condo conversions, with detractors expressing concern over the sheer volume of activity. Multi-family specialist Jonathan Close of the Nordblom Co. is not among those fearful of that trend, however, maintaining that the lack of new condominiums being built in Massachusetts should keep supply in balance.
“It’s a good market right now,” said Close, who brokered the sale of CambridgeSide Apartments two years earlier to LaSalle Investment Management, which has now sold the asset to Crescent Heights.
