A proposed $1 billion redevelopment of the state-owned Hurley building in Boston’s West End includes just 200 housing units. Governor-elect Maura Healey campaigned on a pledge of prioritizing housing production in a revamped surplus property disposition program. Image courtesy of NBBJ

In a break from Gov. Charlie Baker’s approach, Governor-elect Maura Healey has vowed to give housing developers top priority as the state seeks to accelerate surplus property sales in the new administration. 

Healey joins Boston Mayor Michelle Wu in putting housing development at the forefront when selling off vacant and underutilized public properties, rather than simply seeking the highest offer. 

“The housing shortage is the number one challenge facing the commonwealth, so it makes sense to use our public assets and for the governor to incentivize making it easier to build housing of all types,” said Josh Zakim, executive director of Housing Forward MA. “There’s always that tension when it’s a public asset: Are we looking to get top dollar, which in this day could be lab space? Or the greatest impact, which I would argue is housing?” 

Alliances between Boston City Hall and the governor’s office to address the housing and transportation crises were the first issues mentioned by Wu following her first private meeting with the governor-elect last week. Although the two didn’t go into specifics during a brief press conference, both camps already have gone on the record with policies designed to prioritize housing development through public property dispositions. 

Healey’s housing platform includes a new advisory council to create a statewide policy to maximize the use of state land for housing production. It also calls for changes in how the state offers properties, suggesting that developers could receive discounts tied to affordability, and that agencies sell parcels in groups rather than individually. 

In June, Wu announced an inventory of 1,200 municipal properties in Boston that will be offered to developers, with the goal of increasing affordable housing, reducing homelessness and providing transformative development. 

Developers warn that Healey’s push for housing will hit resistance if state agencies don’t do a better job of communicating with local officials, who have the final say over approvals. 

“You don’t just want to offer it up to the developer and not have the community involved in the process. It is incumbent upon the state to have those conversations with the community,” said Adam Stein, senior vice president of development at WinnCompanies. 

A Break from Baker’s Approach 

The Baker administration did not require affordable or mixed-income housing – or any residential space at all – at some high-profile offerings of publicly-owned real estate in recent years. The Massachusetts Turnpike air rights parcel 12 project in Back Bay is being developed as an office-lab tower and hotel. 

In its largest recent site offering, the administration didn’t require a minimum housing component in offering up the Charles F. Hurley state office building in Boston’s West End for redevelopment. The selected developer, Leggat McCall Properties, has included 200 housing units in a proposed $1 billion development including a life science tower and state offices. 

Housing developers applaud Healey’s emphasis on housing production, but caution that local officials still call the shots in approving projects. 

WinnCompanies’ Stein said improved communication between state agencies, developers and local communities is critical. 

In September, the state Division of Capital Asset Management and Maintenance selected a team of WinnCompanies and AvalonBay Communities to redevelop 23 acres on the Salem State University campus. 

A request for proposals issued in February specifically sought housing proposals. AvalonBay Communities proposes new construction of 250 apartments, replacing student housing. WinnCompanies proposes renovating a group of vacant buildings for 125 units of mixed-income senior housing. 

Stein pointed to the early involvement of city government as key to building support. Before the formal state offering, the city hired architects Sasaki in 2020 for a master plan study of the south campus, which recommended up to 400 multifamily housing units. 

A Cautionary Tale in Medford 

A cautionary example of the disconnect between state and local goals took place in Medford after the Massachusetts Department of Transportation sold a repair shop property at 300 Mystic Ave. to Malden-based developer Combined Communities in 2019. 

In announcing the sale, the Baker administration said the property would be redeveloped into 500 housing units. Combined Properties submitted plans for a 378-unit apartment complex under the state’s Chapter 40B affordable housing law. 

But Medford Mayor Breanna Lungo-Koehn came out in opposition to the housing proposal in 2020. In September 2022, Combined Properties presented preliminary plans for a 1.2 million-square-foot life science development. 

Ideally, the state would be a “partner” in the local entitlement process, Stein said, and confirm availability of local aid such as Community Preservation Act funding. 

“You don’t just want to offer it up to the developer and not have the community involved in the process. It is incumbent upon the state to have those conversations with the community,” he said. 

Steve Adams

That’s what has been happening in Chelsea, where DCAMM selected affordable housing developer Pennrose in 2021 to revamp the Chelsea Soldiers’ Home property into 248 units of mixed-income housing. The project would convert the roominghouse-style units into conventional apartments. 

Charlie Adams, Pennrose’s regional vice president, said DCAMM has been instrumental in communicating with local stakeholders. Pennrose is expected to begin its local permitting process in early 2023. 

“If the state and the city aren’t on the same page that is going to be problematic if you have to get local zoning approval,” Adams said. “Our experience has been the opposite. DCAMM has done a really good job with the city to lay the groundwork.” 

For affordable housing developers such as Pennrose, public dispositions offer two major advantages over privately-owned parcels, Adams said. 

“The first is obviously being able to get the land at no cost or nominal cost. They also can be very patient because it takes a long time to obtain [low-income] tax credits and financing,” he said. “When we’re working with private sellers, they don’t have the patience.”