This building at 305 Foster St. is one of two office facilities in Littleton that have been sold to FPK Realty, a Marlborough-based investment firm.
Two Littleton office buildings taken back by their lender a year ago have been sold to a local investor, with FPK Realty of Marlborough last week acquiring 295 and 305 Foster St. for $11 million. Totaling 182,000 square feet, the properties were approximately 50 percent occupied at the time of the sale.
“They are great buildings,” said Garry Holmes of Natick-based R.W. Holmes Realty, who represented the buyer in the transaction. “They are [positioned] to do well as the market improves.”
The purchase by FPK Realty comes several months after the buildings were placed on the market by Lennar Partners of Florida, including a brief stretch when the assets were tied up by another local investor, National Development of Newton. When that Newton-based firm backed off its commitment, FPK was ready to step in and complete the deal. Calls to FPK owner Frederick M. Daley III and Lennar Partners officials were not returned by press deadline. Lennar was represented by Gary J. Lemire of CB Richard Ellis/Whittier Partners, who said he believes both sides were satisfied with the outcome.
“I think everybody got pretty much what they wanted,” said Lemire, a principal and investment specialist with CBRE/Whittier.
Lennar took control of 295 and 305 Foster St. last year after owner Berkeley Investments of Boston opted to give the properties back to the lender. As with other suburban office buildings throughout the Interstate 495 corridor, 295 and 305 Foster St. had performed well during the region’s boom times of the late 1990s and 2000, but ran into difficulties when the subsequent recession crippled the technology sector upon which much of the business momentum had been based.
‘Tons of Power’
Despite the area’s lingering struggles, investment sales of suburban office buildings have remained active for much of 2004, particularly for stabilized properties sporting strong credit tenants. But while those have remained the preferred targets of most investors, riskier assets with substantial vacancies also have captured their share of attention in recent months. Indeed, sources also claimed last week that an investor is homing in on another Littleton office building, 151 Taylor St., which is completely empty. That property is currently owned by Hewlett-Packard, which obtained it as part of its purchase of Compaq Computer.
It is unclear what the unnamed suitor is proposing to pay for 151 Taylor St., although the asking price for the 2-story, 100,000-square-foot was initially set at $7 million. Spaulding & Slye Colliers Senior Vice President Scott J. Jamieson, who has been marketing 151 Taylor St. for the owners, declined comment on the situation when contacted last week, citing confidentiality agreements. Jamieson did detail several attributes about the property, including “tons of power” and redundant mechanical systems, as well as unusually large floor plates of 50,000 square feet.
“It’s a very efficient and flexible building,” Jamieson said of the 17-year-old structure. The broker was mum on the status of another Hewlett-Packard building he is also marketing in suburban Boston, that being the much larger 334 South St. in Shrewsbury. Another asset left from the days of Digital Equipment Corp., which was purchased by Compaq prior to its acquisition by Hewlett-Packard, 334 South St. features 400,000 square feet of space and includes such amenities as an auditorium and full-service cafeteria.
According to one source, an investor has 334 South St. under contract and is slated to close later this month. Constructed in 1991, that property was put up for sale with an asking price of $30 million. Jamieson would not discuss the status of the Shrewsbury property or offer any information such as the identity of the suitor or the sales price, again due to confidentiality issues.
Although Jamieson was unable to provide specifics about deals in which he is actively involved, he did concur that the suburban investment market has been solid for most of 2004. “There is more capital than there is product available across the board,” said Jamieson, whose firm earlier this year sold another Hewlett-Packard building in Burlington to the Lahey Clinic. The health care institution will apparently use that building at 29 Burlington Mall Road for its own purposes, joining a number of users who are opting to buy properties as opposed to leasing.
“Users are taking advantage of the record-low interest rates,” Cushman & Wakefield broker J.P. Plunkett said in explaining that recent trend, with his firm recently representing a Canton company in its purchase of a 32,000-square-foot facility in Marlborough that the buyers will occupy. Plunkett was joined by colleague Cathy Minnerly and J.R. McDonald in brokering that sale at 410 Forest St.
As for the suburban office sector in general, Plunkett said he believes investors are increasingly confident that the market’s worst days may be behind it, particularly in light of several prominent leases which have taken place during the past few months. “It’s a good sign,” Plunkett said of office properties with vacancies in place finding interest among buyers.
