Yale Properties has retained Trammell Crow Co. to sell the North Andover Mills, a 612,000-square-foot multi-building complex in North Andover. Trammell Crow has enjoyed a strong year of investment sales.
Although one downtown deal appears to be slogging along, Trammell Crow Co. is continuing a strong year of investment sales, with the firm last week closing on one transaction in Natick and picking up a new assignment to trade a multi-building complex in North Andover. Meanwhile, sources claim Trammell has successfully negotiated an agreement to sell a Back Bay office building to Beacon Capital Partners for more than $75 million.
In the latest endeavor, Yale Properties has retained Trammell to sell the North Andover Mills, a 612,000-square-foot asset that has some vacancy but also features a measure of stability with a long-term tenancy to Schneider Automation Inc.
“I think it is going to attract a ton of interest,” said Trammell Crow principal James F. McCaffrey. With an ability to break the complex up and sell it to different parties, “it should appeal to a lot of [investors],” he said.
McCaffrey could not offer a timetable on when the North Andover property might sell, but said Trammell appears on track to broker upward of $500 million of commercial real estate in 2004, including the two-building sale in Natick that closed last week. In that agreement, The MathWorks Inc. acquired the properties it occupies on Apple Hill from owner SSR Realty Advisors. McCaffrey placed the sales price in the $50 million range. The MathWorks was represented by Garry R. Holmes of Natick-based R.W. Holmes Realty Co.
McCaffrey was less able to discuss the situation with Boston’s 160 Federal St., a 24-story office tower in the city’s Financial District that has been on the market since the summer. Owners Invesco Real Estate and Taurus Investment Holdings LLC have reportedly been seeking upward of $90 million for the prominent office tower.
Several sources claim the building has been pulled off the sales block, but while he would not confirm or deny the rumors, McCaffrey seemed to indicate that the asset is still in play. “Everyone was counting the Red Sox out in the middle of [the American League Championship Series],” he noted, alluding to the hometown baseball team’s dramatic rebound to beat the New York Yankees after trailing three games to none.
Calls to Taurus and Invesco were not returned by press deadline. The two firms acquired 160 Federal St. in November 2000 for $81 million, completing an intricate transaction that included buying out the condominium interests of the previous owners, Meredith & Grew and Pricewaterhousecoopers. The acquisition came at the height of Boston’s office market boom, a time when countless Boston properties changed hands at often record-setting prices. Taurus had been an active player in the market, buying up such buildings as 148 State St., 184 High St. and 87 Summer St., all of which it has subsequently sold.
Declining Conditions
Market conditions have worsened steadily since the start of the new millennium, but rising vacancy rates and plummeting rents have done little to quash investor enthusiasm for commercial real estate overall and for downtown Boston properties in general. Continued bad news has made it harder to sustain that interest, although the region appears to be headed for one of its best years ever in property sales.
Trammell Crow has had a hand in selling several local assets, including 711 Atlantic Ave., purchased recently by a Connecticut investor. And while rumors are persistent that 160 Federal St. is being pulled back, Trammell seemingly overcame similar death notices about the sale of 116 Huntington Ave., the property now under agreement to Beacon Capital Partners. After futile negotiations with one suitor earlier in the year, reportedly ING Clarion, sources had claimed the 14-story building had been taken off the market by the New Boston Fund, which has owned the property since late 2002.
Whether 116 Huntington Ave. was ever officially retracted by New Boston Fund remains unclear, with McCaffrey opting against discussing the situation, but sources insist that Beacon has indeed now tied the asset up and is proceeding toward a closing. The price is estimated to be between $75 million and $78 million for the 265,000-square-foot building.
In any event, Trammell is certainly pursuing the sale of the North Andover Mills. Dating back to 1860, the red brick mill complex was renovated and restored in 1986, with additional expansion to the property in 1993. It is comprised of two distinct components known as the East and West campuses, each of which is being offered for sale individually or collectively.
North Andover Mills East is leased entirely to Schneider, which is committed to the 382,000-square-foot complex through July 2013. Given the firm’s backing by Schneider Electric, a worldwide manufacturer and distributor of automation and electrical components, the property carries a strong credit element expected to lure investors seeking long-term stability.
The other portion of the complex features 14 interconnected buildings with 229,000 square feet of space. It is presently 70 percent leased, according to Trammell Crow, with such tenants as Motorola, Converse Shoe and Aurora Imaging. Joining McCaffrey in marketing the property are Trammell Crow brokers Peter S. Joseph, Christopher A. Phaneuf and Jordan C. Berns.
