Chicago-based Transwestern Investment Co. has purchased Brickstone Square in Andover (above) and a 4-story, 85,000-square-foot retail/office building in Newton.
Transwestern Investment Co. is not limiting its real estate approach to the firm’s name, or so one might infer from two just-completed acquisitions in suburban Boston.
As reported by Banker & Tradesman last week, the Chicago-based concern has purchased Brickstone Square in Andover and a 4-story, 85,000-square-foot retail/office building in Newton. After securing Brickstone Square from Lehman Bros., Transwestern paid $12.6 million for 313 Washington St. in Newton Corner, closing on the asset last week in a deal with Paradigm Properties, the owner since 1999.
The additions give Transwestern a triumvirate of properties in Greater Boston, including Waltham’s University Office Park, acquired last year for $22.5 million in its first direct investment in the area. Efforts to reach Transwestern officials were unsuccessful, but most observers contacted gave the operation solid grades, including Elizabeth Carrillo Thomas, a CBRE/New England senior vice president who negotiated the Waltham transaction.
“They are a pleasure to work with,” said Thomas, who is familiar with some of Transwestern’s principals from her days as a capital markets specialist in Chicago. Besides being able to handle complex real estate challenges, the firm has a track record of timely investing, said Thomas, noting that the group “made a bet on Waltham” just prior to that market’s resurgence. Spaulding & Slye Colliers broker Matt Daniels seconded that assessment, offering a measure of hope for the Brickstone Square development, which also sports substantial vacancy.
Daniels acknowledged earlier reports that his firm has been named exclusive leasing agent for Brickstone Square. “We’re very happy to have it,” Daniels said. “I think we have a very strong team to service the account.” Joining Daniels on that assignment will be Flory McCarthy and Philip Geiger.
Citing the firm’s successes at University Office Park, Daniels said he believes Transwestern will be able to take Brickstone Square “to the next level” after a somewhat bumpy ride during the region’s economic slump. Originally developed by Brickstone Properties, the 1 million-square-foot park proved among the northern suburban market’s most popular business addresses during the late 1990s and into 2001, even luring high-flying CMGI as the lead tenant. When the venture capital firm became the face of the area’s technology crash, forcing it to slink away in 2003 from nearly 300,000 square feet of space, Brickstone Square struggled financially until it was ultimately taken back by Lehman Bros.
After Lehman landed defense giant Northrop Grumman for an 80,000-square-foot lease this autumn, the property seemingly became stable enough to offer for sale, leading to the off-market disposition to Transwestern. Daniels expressed optimism about the prospects going forward because of Transwestern’s involvement and other factors.
“They are very high on tenant satisfaction, and very open in doing deals to get their buildings leased up,” he said. Brickstone Square, meanwhile, fits in well with the flight-to-quality trend which has been prevalent in Greater Boston’s office market, said Daniels, offering not only a range of on-site amenities, but also modern space most sought after at present. “As far as second-generation space goes, this is in first-class condition,” he said, including a block of space left over from the opulent CMGI’s departure. The management of Urban Retail Management and asset steward Rockwood Capital of New York also helped keep the quality up during the difficult stretch, said Daniels, adding he believes the Andover area is on the mend.
“Tenants seem to be high on their business plans,” he said. Activity “is not monumental by any stretch, but there’s good, positive news in the marketplace,” Daniels added.
‘Between Two Markets’
Closer to its Waltham property, Transwestern’s 313 Washington St. deal is perhaps a little less speculative, with the location in Newton Corner considered accessible from both the suburbs and downtown Boston. A toll-free exit off the Massachusetts Turnpike Extension is a major plus for Newton Corner, said Thomas, who said the deal also demonstrates the regard real estate investors have in Boston’s so-called inner suburbs of Newton, Watertown and Cambridge.
Thomas last month, for example, negotiated the $20.1 million sale of 101 Walnut St. in Watertown. Acquired by Paradigm Properties as part of a tenant-in-common investment program, 101 Walnut St. attracted a large number of national investors, said Thomas, attributing it partly due to the lone tenant’s strong credit and lengthy lease of the 95,000-square-foot building, but also indicative of the regard held for the inner suburbs, especially properties near the Arsenal on the Charles office/retail complex owned by none other than Harvard University.
“It’s between two markets,” Thomas said in explaining the allure, with tenant demand emanating from the Hub and also business owners who live in and around Newton. As for Transwestern itself, Thomas said she believes the recent purchases show the firm anticipates a rebound in the area. “They are bullish on Boston,” she said.
Paradigm Properties had owned 313 Washington St. since 1999, having paid $11.8 million for the asset. Company president Kevin McCall told Banker & Tradesman last week that the sale was prompted by the normal deal cycle of the investment and a good climate to trade properties, adding his firm is also positive about the inner suburban region going forward. Paradigm’s tenant-in-common vehicle has been busy in other parts of the country as well, including last month’s sale/leaseback of a 550,000-square-foot property in Detroit.
Richards Barry Joyce & Partners brokered the sale of 313 Washington St. on behalf of Paradigm. McCall praised the efforts of that group and RBJ investment chief Richard Herlihy. Paradigm will continue to manage 313 Washington St. on behalf of Transwestern.
