[ARCHIVED] Harbor Garage Redevelopment | 70 East India Row | Waterfront | Downtown

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Re: The Boston Arch (Aquarium parking garage)

All apologies in advance for continuing this discussion. My opinion is based only upon a quick glance at the relevant issues. I could be wrong. This should be moved to the general section etc. etc.

That opinion is a bit misleading as it was specifically responsive to a proposed House bill that called for the taking of land and construction of a ballpark. The crux of the opinion is that the development of a stadium is not sufficient to establish a public purpose absent any controls ensuring that it is not a bad faith taking.

On the other hand, if the legislation itself contains standards and principles governing and guiding the operation of the facilities in a manner which reasonably can be expected adequately (a) to protect all aspects of the public interest and (b) to guard against improper diversion of public funds and privileges for the benefit of private persons and entities, then such enterprises may be found to be for public objectives.
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A more detailed description of the issues provided that:

In the light of the foregoing discussion we comment more directly on the individual questions. As to Question 6 we entertain no doubt that bonds may be issued to pay the cost of a stadium complex and arena, if adequate principles, standards, and safeguards governing the execution of the project are included in the enabling legislation to make the project one for a public purpose. As to Questions 7 and 8 we are of opinion that the auxiliary and incidental activities and functions mentioned in the questions may be included in a project if they are to be conducted under adequate statutory standards, and that leases and concessions may be negotiated and effected in accordance with such standards, if they are provided. As to Questions 9 and 15, under suitable statutory standards, provision of facilities in aid of a proper public purpose will not be rendered unconstitutional simply because individuals or private entities, as such, incidentally may profit. See Opinion of the Justices, 354 Mass. 779, —-, 236 N.E.2d 523,FND and cases cited. We think that the existence of a proper public purpose will not be destroyed if the Authority makes proper leases of the stadium complex or the arena (pursuant to a statute containing appropriate standards) to a privately owned entity operating for profit. Indeed such leases may be essential to obtaining the revenues with which to pay the proposed bonds. See City of Boston v. Merchants Natl. Bank, 338 Mass. 245, 249, 154 N.E.2d 702. The lease of State owned or State financed facilities to private enterprises is not a novelty. See e.g. the situations considered in Dehydrating Process Co. of Gloucester, Inc. v. City of Gloucester, 334 Mass. 287, 135 N.E.2d 20; Gloucester Ice & Cold Storage Co. v. Assessors of Gloucester, 337 Mass. 23, 147 N.E.2d 820, and Board of Assessors of Newton v. Pickwick Ltd., Inc., 351 Mass. 621, 223 N.E.2d 388, and cases cited in these three decisions. As to Questions 10 and 16, if House No. 5486 should be in fact revised to include such statutory principles and standards as will make the construction and operation of the stadium and arena for a proper public purpose, we are of opinion that the Authority may be granted both power to take land by eminent domain and tax exemption. See Dodge v. Prudential Ins. Co., 343 Mass. 375, 383—384, 179 N.E.2d 234.
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As the SJC made clear in Providence and Worcester R.R. Co. v. Energy Facilities Siting Bd. 453 Mass. 135 (2009) makes clear

...we consider the statutory text itself, [delegating the State's authority to use eminent domain] "the principal source of insight into Legislative purpose." (citations omitted).
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And as Toby mentioned

General Laws c.40, s.14 authorizes the City Council to vote to take by eminent domain under G.L. c. 79 “any land, easement or right therein within the city or town not already appropriated to public use, for any municipal purpose for which the . . . taking of land, easement or right therein is not otherwise authorized or directed by statute.”
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As such, the land could probably be taken, and according to the 1969 Opinion, these municipal purposes could include:

supplying housing, slum clearance, mass transportation, highways and vehicular tunnels, educational facilities and other necessities...even where there may be involved arrangements with private persons or entities operating for profit.
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Re: The Boston Arch (Aquarium parking garage)

Hutchinson, and the public purpose in taking Harbor Towers land falls where within that enumerated list of public purposes?
 
Re: The Boston Arch (Aquarium parking garage)

In conjunction with flipping it to a private developer? I could see a school within a mixed use building, an increased percentage of affordable housing, etc. That list certainly isn't dispositive of all public purposes. As the Opinion itself states, there could perceivably be many public benefits stemming from the construction of a stadium, including tax/lease revenues.
 
Re: The Boston Arch (Aquarium parking garage)

Hutchison said:
In conjunction with flipping it to a private developer? I could see a school within a mixed use building, an increased percentage of affordable housing, etc. That list certainly isn't dispositive of all public purposes. As the Opinion itself states, there could perceivably be many public benefits stemming from the construction of a stadium, including tax/lease revenues.
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But that's not what the proponent was asking about Lisbon wants to seize the land around the Harbor Towers because the 'idiot' residents of the towers are NIMBYs, frustrating the development of Boston, and particularly Chiofaro's towers. His taking is punitive, pure and simple.

Shoe on the other foot. Perhaps the city ought take the garage by eminent domain, the public purpose being to eventually build a school on the site of the garage. Isn't the city about to spend about $250 million for a new school in downtown Boston, the cost being driven by the price of available land. Far and away the most expensive public school ever built in Massachusetts.
 
Re: The Boston Arch (Aquarium parking garage)

^Daaaaayum. In NYC the city gets developers to build their schools for them in exchange for larger projects.
 
Re: The Boston Arch (Aquarium parking garage)

Property is not seized by eminent domain when it's turning a substantial profit.
 
Re: The Boston Arch (Aquarium parking garage)

stellarfun said:
But that's not what the proponent was asking about Lisbon wants to seize the land around the Harbor Towers because the 'idiot' residents of the towers are NIMBYs, frustrating the development of Boston, and particularly Chiofaro's towers. His taking is punitive, pure and simple.

Shoe on the other foot. Perhaps the city ought take the garage by eminent domain, the public purpose being to eventually build a school on the site of the garage. Isn't the city about to spend about $250 million for a new school in downtown Boston, the cost being driven by the price of available land. Far and away the most expensive public school ever built in Massachusetts.
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The question was "could the city seize the land by eminent domain?" (purportedly to flip it for some use that isn't "deadening" at the pedestrian level)

The simple answer is, in many conceivable cases, yes.
 
Re: The Boston Arch (Aquarium parking garage)

stellarfun said:
Isn't the city about to spend about $250 million for a new school in downtown Boston, the cost being driven by the price of available land. Far and away the most expensive public school ever built in Massachusetts.
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That seems exorbitantly high and I cannot find that figure anywhere.
 
Re: The Boston Arch (Aquarium parking garage)

Hutchison said:
The question was "could the city seize the land by eminent domain?" (purportedly to flip it for some use that isn't "deadening" at the pedestrian level)

The simple answer is, in many conceivable cases, yes.
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I agree there are conceivable cases, but the days when the Commonwealth's public purpose test that allowed the demolition of the West End and the construction of Charles River Park are gone, ( Kelo aside).

Whether Lisbon knew this or not, the Harbor Towers residents have a property interest in the garage itself. An eminent domain taking would extinguish their property interest, allowing Chiofaro to proceed post haste with construction of his tower(s) and at least theoretically increase his profit. (Even in Kelo, New London retained a property interest in the land after taking it, but the basic construct for East India Row would be to seize the property interests of one private party to enhance the property value of another private party without any substantive, intervening public ownership.)

In Allston at Barry's Corner, nearly all the properties on the southeast corner of the Corner are owned by Harvard, except, IIRC, for two parcels. One of the parcels is a three story apartment house of ordinary construction. This corner is called the Keystone Block, because it is key to the re-development of Barry's Corner. The block cannot be efficiently re-developed until Harvard gains ownership of these two parcels. I wonder why the city doesn't take these two parcels by eminent domain, and 'flip' ownership over to Harvard? Its not that Harvard cannot afford to pay for the taking of these properties. Similarly, the market rate mid-rise for the second phase of Charlesview is impinged because Harvard doesn't own an abutting parcel.
 
Re: The Boston Arch (Aquarium parking garage)

Forget about Kelo. Read the Springfield case I cited above. The court killed a taking which was for a minor league stadium for the benefit of the Mets. The decision is long, but is the finest ever piece of legal writing on eminent domain law in the Commonwealth.
 
Re: The Boston Arch (Aquarium parking garage)

I really don't understand why Chiofaro isn't just waiting this out. Whatever reason him and Menino don't get along will be moot soon. If the new mayor is Walsh I really doubt he would stand in the way of this project. Don't know much about Connoley though but he seems prodevelopment too.
 
Re: The Boston Arch (Aquarium parking garage)

^Don't forget the large mortgage for the garage that Chiofaro(and his backers) has to pay.
 
Re: The Boston Arch (Aquarium parking garage)

Scalziand said:
^Don't forget the large mortgage for the garage that Chiofaro(and his backers) has to pay.
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Chiofaro and Prudential bought the garage in 2008 for $153 million, financed in large part by a five year balloon note for $85 million. That note was refinanced a few months ago to another five year balloon note, with the value of the note increased to $90 million. The property is assessed for $77 million, of which $56 million is the value of the 57,000+ sq ft of land. So the land is assessed for about $1,000 a sq ft.

By contrast, a little further down on Atlantic Ave., there is a privately owned parcel of land, about 19,000 sq ft, and undeveloped, and assessed for $85 a square foot. Not that far away, on the east side of Atlantic Ave., the land for a relatively new building is assessed for about $500 a sq ft.

The New England Aquarium's land goes way out into the harbor, so I am guessing that the 108,000 sq ft labeled as 'gross area' is the land that one can walk on, as opposed to paddling above. On that basis, the assessed value of the Aquarium land is roughly about $460 a sq ft.
 
Re: The Boston Arch (Aquarium parking garage)

The land valuation on property record cards of developed properties is usually artificial and backed into. If you tried to separate out that value at the Appellate Tax Board, you'd get your head handed to you. On something like a garage structure you'd do an income approach to valuation, and in that method, land value is a non-factor.

Comparing land values with neighborhood properties is not dispositive, and I'd be reluctant to estimate the value of the plaza based on an extrapolation from neighboring land value assessments since in most cases, the land values are purely hypothetical and not how the market would arrive at a value.

That plus you'd do a highest and best use analysis of the open space, and you'd have to take into account not only zoning restrictions, but Chapter 91 limitations.

I don't know whether the garage valuation is correct, and you'd have to do up a pro forma. There is no assigned asset value for the land, although you'd factor the taxes in either above the line or in the cap rate. Parking being what it is in Boston, I imagine the cap rate would be pretty low.
 
Re: The Boston Arch (Aquarium parking garage)

tobyjug, I agree with all that.

The assessed value of land is the value that can be most readily played with when setting the total assessment. The assessed value of my land is about $400 a sq ft. which is about the assessed value of nearby unimproved land.

Value is in the eyes of the beholder, but my guess that the $90 million note reflects what the lender believes is much nearer the current true value of the harbor garage. And if so, there is no equity position that could be leveraged to help finance new construction.
 
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Re: The Boston Arch (Aquarium parking garage)

This thread is turning into a real estate law and finance course. I liked it better when it was more focused on gross outdoor public hot tubs and weird NIMBYs.
 
Re: The Boston Arch (Aquarium parking garage)

This would be a great location to celebrate dropping the ball in Boston if Harbor Garage ever got built out into something significant .

I could see the Greenway being the spot to be for NEW YEARS EVE with the strip loaded with bright lights, restaurants and bars.

Happy New Year 2014
 
Re: The Boston Arch (Aquarium parking garage)

TheRifleman said:
This would be a great location to celebrate dropping the ball in Boston if Harbor Garage ever got built out into something significant .

I could see the Greenway being the spot to be for NEW YEARS EVE with the strip loaded with bright lights, restaurants and bars.

Happy New Year 2014
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Drop a Case of Tea into the Harbor what a clever idea -- we could advertise it as the Boston Tea Party .... Wait .. someone already did that in Boston? .. No kiddin? and it was even close to New Years Day??? .... let see ... Ah yes .. December 16 1773
Boston_Tea_Party-Cooper.jpg


What's the fascination with dropping things ..." Check out The sun, with all those planets revolving around it and dependent on it, can still ripen a bunch of grapes as if it had nothing else in the universe to do". --- Galileo Galilei in Discorsi e dimostrazioni matematiche, intorno à due nuove scienze {The Discourses and Mathematical Demonstrations Relating to Two New Sciences}, published in 1638 ... where he also discusses the laws of falling objects
 
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