Volpe Transportation Center Development | Kendall Sq | Cambridge

curcuas said:
Reading between the lines, I think the constellation center guy is a total shyster. He's using a "charity" as excuse to tour europe and go to concerts and other art performances and paying no taxes on highly valuable land. When he's forced to sell, he'll make a fortune.
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Meh. My reading on him is that he's a rich and eccentric idealist with a dream and not too much of a foothold in reality. He seems to have his heart in the right place, but it's just not going to happen.

If by some crazy stroke of fortune the Constellation Center that resides in his mind does become reality, that would be fantastic. I'd take a state-of-the-art performance venue over another lab building any day.
 
JumboBuc said:
Meh. My reading on him is that he's a rich and eccentric idealist with a dream and not too much of a foothold in reality. He seems to have his heart in the right place, but it's just not going to happen.

If by some crazy stroke of fortune the Constellation Center that resides in his mind does become reality, that would be fantastic. I'd take a state-of-the-art performance venue over another lab building any day.
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JumboBuc -- Why??? --- there are plenty of mostly dark commercial performance venues and plenty more university performance venues

Unless the "State-of-the-Art Performance Venue" comes fully endowed it would rapidly become a white elephant
 
Agreement finalized.

http://news.mit.edu/2017/agreement-redevelop-volpe-center-kendall-square-0118

MIT-Volpe-01_0.jpg
 
bigpicture7 said:
^ MIT's bid was $750million. Jeez Kendall Sq. is hot.
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This works out to something like $1,722 per sq ft of land (they only get to develop 10 of the 14 acres, the other 4 acres go for the new Volpe Center building). That has to be one of the highest prices for development land in Boston/Cambridge history.

(For comparison, the Seaport Square transaction in 2015 for 12.5 acres was about $659 per sq ft.)
 
So.

Either MIT works with Cambridge and gets them to rewrite the books and allows them to build BIG and DENSE, or we get the cheapest build out ever to try to recoup on that investment at all...

Hopefully the former.
 
SeamusMcFly said:
So.

Either MIT works with Cambridge and gets them to rewrite the books and allows them to build BIG and DENSE, or we get the cheapest build out ever to try to recoup on that investment at all...

Hopefully the former.
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Maybe we'll get that 1000' tower here after all. I'm not holding my breath.
 
SeamusMcFly said:
So.

Either MIT works with Cambridge and gets them to rewrite the books and allows them to build BIG and DENSE, or we get the cheapest build out ever to try to recoup on that investment at all...

Hopefully the former.
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Not sure MIT is really looking to recoup their investment. They're not a traditional developer.
 
The $750 million almost certainly includes the cost of replacement Volpe, which might run to $400 million (@ $1,000 a sq ft). If so, MIT is paying about $35 million an acre for the land it gets to develop.

From the MIT press-release, it would seem that most of what MIT will build will be tech-related.

...the Institute will use the redevelopment opportunity to help foster the continued trajectory of Kendall Square as a world-class innovation hub. This will, he says, enhance academic-industry connections and help MIT-invented technologies move more quickly from lab to market.
...
MIT’s engagement with the Volpe property will allow us to further help shape the local innovation ecosystem
...
to plan a vibrant mix of uses, including commercial innovation space, residential and retail facilities, and open space on the remaining 10 acres.
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Emphasis mine.

I should add that the timing was such that Trump can't put a hold on the deal.
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I'll add that if MIT develops secven of the ten acres it owns, and has a building footprint of 40,000 sq ft per acre, and each building is 10 floors, you are nearly at 3 million square feet of new building.
 
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stellarfun said:
The $750 million almost certainly includes the cost of replacement Volpe, which might run to $400 million (@ $1,000 a sq ft). If so, MIT is paying about $35 million an acre for the land it gets to develop.

From the MIT press-release, it would seem that most of what MIT will build will be tech-related.


Emphasis mine.

I should add that the timing was such that Trump can't put a hold on the deal.
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Why would Trump put a hold on it? It's a good deal for the Government.
 
stellarfun said:
The $750 million almost certainly includes the cost of replacement Volpe, which might run to $400 million (@ $1,000 a sq ft). If so, MIT is paying about $35 million an acre for the land it gets to develop.
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If MIT pays $750 million total and gets 10 acres to develop in return, that's $75 million per developable acre. It doesn't matter what portion of that $750 million goes to build the new Volpe facility; either way it all adds up to MIT's cost basis.
 
stellarfun said:
The $750 million almost certainly includes the cost of replacement Volpe, which might run to $400 million (@ $1,000 a sq ft). If so, MIT is paying about $35 million an acre for the land it gets to develop.
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(seeing Jumbo's response as I'm writing this)

What's crazy is that however you run the numbers it's substantially higher than similar scope transactions elsewhere in boston/cambridge...e.g., it would still be $809/sq ft. for the developable land portion if an assumed $400m Volpe re-build cost and 4 acres are not included.

EDIT: and I agree with Jumbobuc...they are not getting reimbursed for the money it takes to re-build Volpe, nor are they getting those acres...so at the end of the day it's still $750M for 10 buildable acres, or about $1722 / sq. ft. Crazy.
 
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Equilibria said:
Why would Trump put a hold on it? It's a good deal for the Government.
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Incoming Presidents, regardless of party, tend to put holds on major pending transactions for two reasons: 1.) so that they can review and decide on whether the transaction should be finalized, on the merits; 2.) forestall any attempts at sweetheart deals by an exiting President and his administration.

And the head of GSA is resigning by tomorrow, so a GSA signature would await the swearing-in of the replacement Administrator.
 
Equilibria said:
Not sure MIT is really looking to recoup their investment. They're not a traditional developer.
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If it's MITIMCo (which based on the intended uses I'd assume it is), then they would absolutely be looking to recoup as much as possible.

"OUR MISSION IS TO DELIVER OUTSTANDING LONG-TERM INVESTMENT RETURNS FOR MIT." http://www.mitimco.org/
 
stellarfun said:
Incoming Presidents, regardless of party, tend to put holds on major pending transactions for two reasons: 1.) so that they can review and decide on whether the transaction should be finalized, on the merits; 2.) forestall any attempts at sweetheart deals by an exiting President and his administration.

And the head of GSA is resigning by tomorrow, so a GSA signature would await the swearing-in of the replacement Administrator.
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Don't forget reason 3. So their administration can take credit for it if it's a good deal.
 
bigpicture7 said:
(seeing Jumbo's response as I'm writing this)

What's crazy is that however you run the numbers it's substantially higher than similar scope transactions elsewhere in boston/cambridge...e.g., it would still be $809/sq ft. for the developable land portion if an assumed $400m Volpe re-build cost and 4 acres are not included.

EDIT: and I agree with Jumbobuc...they are not getting reimbursed for the money it takes to re-build Volpe, nor are they getting those acres...so at the end of the day it's still $750M for 10 buildable acres, or about $1722 / sq. ft. Crazy.
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That was my reasoning as well. Their "reward" for making the $750 million investment, regardless how it is allocated, is the 10 developable acres. So that defines the cost of that land.
 
JumboBuc said:
If MIT pays $750 million total and gets 10 acres to develop in return, that's $75 million per developable acre. It doesn't matter what portion of that $750 million goes to build the new Volpe facility; either way it all adds up to MIT's cost basis.
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True enough on a cost basis, but my larger point was that MIT was not paying $750 million, and then paying another $400 million on top of that.

IIRC, MIT previously said 1.) it needed to develop the site quickly to recover its sunk costs, and 2.) MIT would not use the property for MIT academic buildings, --and, for the price, it won't be housing students on it either.
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On the new FBI Headquarters, it appears the government will not get enough money for the current HQ, and the land it sits on, to offset the $2.1 billion cost of a 2.1 million sq ft new headquarters.

https://www.washingtonpost.com/news...on-costs-metro-access/?utm_term=.dbbb8f91b8ff
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A certain real estate developer also named Don paid $155 million for 53,000 sq ft.
 
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I'm curious as to how long the current Volpe tower will stand. After the new Volpe building is finished and the DOT moves out of the existing tower, I could imagine it functioning perfectly well as (relatively) cheap "innovation space" while the rest of the site (low rises, parking lots, lawns) is being built up.

I wouldn't be surprised at all if it's still standing in 2030.
 
This is good news but I agree nothing is written in stone here without the paperwork being signed by the GSA. For all we know the Trump admin has it out for liberal MIT and Cambridge and intends to put the kabosh on this deal, rebid it and award it to a developer while revoking the zoning jurisdiction to Cambridge so that developer can do whatever it wants. He is all about "Getting Even" after all.

Unlikely, but we don't know.
 
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