Evolving use of Office and other Space

[bigpicture7]

Was glad to see this take in the Globe this morning.
I have been saying for a while that residential is not the only adaptive reuse of office space. When it comes to physical products, the creative, design + prototyping, and light-mfg/fabrication opportunities are activities push out of city cores a long time ago, yet ideally there'd be a home for such there. I think, for some areas, the safety/EHS considerations might make office buildings challenging, but that may only be a small subset of possible uses (and/or the mitigations might still be easier than residential conversion). Either way, I think this deserves a bigger place in the conversation:

Turn empty offices into little factories - The Boston Globe

Let’s build stuff closer to where the people are — and future-proof our environment and economy in the process.

www.bostonglobe.com

Downtown needs an infusion of artists - The Boston Globe

Affordable art studios and live-work spaces are great ways to rejuvenate neighborhoods.

www.bostonglobe.com

 

[HenryAlan]

Yes, I've been making the case for light industry/manufacturing repurposing of office buildings for a while. I think it could be particularly beneficial to mix with residential use, where the challenge has been how to address large floor plates. Ring the perimeter of the building with housing, and use the internal core for industry, data centers, vertical agriculture, etc. We need to start thinking further outside the box and floor plate limitations.

 

[BeyondRevenue]

Was glad to see this take in the Globe this morning.
I have been saying for a while that residential is not the only adaptive reuse of office space. When it comes to physical products, the creative, design + prototyping, and light-mfg/fabrication opportunities are activities push out of city cores a long time ago, yet ideally there'd be a home for such there. I think, for some areas, the safety/EHS considerations might make office buildings challenging, but that may only be a small subset of possible uses (and/or the mitigations might still be easier than residential conversion). Either way, I think this deserves a bigger place in the conversation:

Turn empty offices into little factories - The Boston Globe

Let’s build stuff closer to where the people are — and future-proof our environment and economy in the process.

www.bostonglobe.com

Downtown needs an infusion of artists - The Boston Globe

Affordable art studios and live-work spaces are great ways to rejuvenate neighborhoods.

www.bostonglobe.com

Way back when, Jane Jacobs made that case as well.

The Economy of Cities by Jane Jacobs: 9780394705842 | PenguinRandomHouse.com: Books

In this book, Jane Jacobs, building on the work of her debut, The Death and Life of Great American Cities, investigates the delicate way cities balance the interplay between the domestic production of...

www.penguinrandomhouse.com

The big picture... innovation happens when you mix different people with different skill sets together seems to be a no brainer, and yet, we cling to outdated notions of restrictive zoning keep that innovation from happening. Madness.
I think of how the phone was invented on a fifth floor on Court Street - but nobody remembers how close Bell's machinist, patent attorney and investors were to his shop.
Companies talk of making synergies within their walls by having people be around each other in a box (especially as a return to work excuse). The real synergies happen at lunch, after work, walking home, grabbing a beer, bumping into friends of friends who know a guy...all mostly walking together. We don't innovate very well together while driving to cloistered remote homes or in steel boxes.

IIRC, Jacobs spends a lot of time talking about chemical toilets. Important, yes. But a she dedicated a lot of words to that endeavor.

 

[andrew.816]

 

[Johnnyrocket891]

Living in downtown Boston is unaffordable for most local residents and rents are as high $2,500--$15,000 a month in some locations.

Who is paying for all these commercial buildings being converted into residential? I'm assuming the taxpayers of the state will take on the rent roll for all the displacement of migrants and homelessness along with sheltering them in downtown Boston were the average working citizen can't even afford to live in the city.

Mayor Wu and Gov Healey need to explain this.

This is nothing more than bailing out billion dollar Developers/Bankers who have dug themselves in so much debt that they can't service the buildings but now the Taxpayers are bailing out these groups on both ends. Tax abatements and refurbishing there buildings with subsidized tenants all funded by the taxpayers. (this is called getting rich off the US Taxpayers back) As they are laughing at you with their backroom deals.

This is why the American peoples RENT, Groceries and everything in life is so expensive because of deals like this along with TENT built cities across the democratic cities.

 

[Justbuildit]

Boston has one of the lowest rental vacancy rates in the country. Like low single digit percent. Those rents may sound high to you (and they objectively are) but there is simply a supply crunch in Boston proper. Note that no proposals for migrants currently include vacant apartments in Boston, since there are none.

I’m not taking the bait on your other points, but building more market rate and subsidized units is good, and the city should continue to incentivize such activities.

 

[Johnnyrocket891]

Boston has one of the lowest rental vacancy rates in the country. Like low single digit percent. Those rents may sound high to you (and they objectively are) but there is simply a supply crunch in Boston proper. Note that no proposals for migrants currently include vacant apartments in Boston, since there are none.

I’m not taking the bait on your other points, but building more market rate and subsidized units is good, and the city should continue to incentivize such activities.

If our so called leaders (politicians) invested our tax dollars in transits Infrastructure (MBTA) across the state then locals/residents could live anywhere throughout the state which would relieve rental rates across the state along with housing costs.
Between western/southern part of Mass.

Make Transit affordable energy self-sufficient and FREE for the US Taxpayers and would bring rental costs throughout the state as residents would be able to live in New Bedford, Worcester, Springfield as long as they can get in and out of Boston in 10-15mins. Would also help relief for mass highway.

Your not taking the bait. How about common sense.

There would be plenty of affordable units outside of Boston if the taxpayers dollars were used for the overall good of society.

Instead they are bailing out a select few connected corporate hacks who purchased these buildings in Boston with loans that can't service the buildings with the lies they need to build affordable housing in Boston along with 75% tax abatement to convert commercial into residential for 25 Years. This deal STINKS

 

[Justbuildit]

I too would like to fix systemic transit issues across the commonwealth. That’s not in the city’s hands and will take a generation to fix. I would also like outlying towns to take a bigger role in fixing the housing crisis, but as we saw with Milton they would rather fight than take the smallest step to adjust their zoning capacity. Good luck.

For now, the downtown core has high commercial vacancy rates in undesirable office buildings. Since commercial real estate taxes are like 75% of the tax revenue for the city, long term vacancies matched by written down assessments will blow a huge hole in the city’s finances.

People are the ultimate multiplier. They spend money in the city, they spur new business investment, and they make the streets safer and busier. Finding quick ways to put (admittedly not that many) people into downtown with a couple new affordable units is a clear net good. The idea that it’s a bailout for big real estate by the city doesn’t make sense.

 

[DBM]

Who is paying for all these commercial buildings being converted into residential?

If you had bothered to read the 85 Devonshire residential conversion application, you'd see it's on the very first page:

"The estimated cost of the conversion is $36 million." Obviously the developer is picking up 100% of that tab. Next time, please review all of the relevant documentation before you embark on a rant which recycles all the usual tired Fox News-style talking points...

 

[Johnnyrocket891]

The developer invests 36 Million in capital into there property to get a 75% standard tax rate for residential for up to 29 Years.

Then Factor in who actually is subsidizing the rent? Will rents become cheaper or will the taxpayers also have to subsidize the rents?

Mayor Wu announces Residential Conversion Program for downtown offices | Boston Planning & Development Agency

See upcoming meetings, task forces, business development trainings, public meetings, and more.

www.bostonplans.org

"The program would offer owners of commercial office buildings Downtown reduced property tax rates in return for immediately converting their buildings to residential uses. Based on studies prepared for the City as part of PLAN: Downtown, a rate reduction by up to 75% of the standard tax rate for residential for up to 29 years could provide a strong incentive to encourage conversion."

The developers are getting bailed out on both ends by not paying taxes, converting the building into residential units and most likely will get subsidize rents that will continue to keep Boston Rents sky high.

BAD DEAL for the Taxapayers only to enrich certain groups. There is no risk and all reward for the developers all on the back of Mass Taxpayers.

Basic necessities will continue to skyrocket politician's making these types of deals. Rents, Food and Transportation costs will continue to skyrocket

 

[Justbuildit]

Yes. And in many instances the “owners” are people who purchased distressed buildings at a loss to the prior owners. These new owners bought these structures with the intent of using this incentive program.

If the city wanted to shil for big real estate they would just make it easier for them to build massive high rises. That is decidedly not the case in Boston. Aquarium garage, James Hook hotel, many other projects were halted on environmental or zoning grounds.

Let’s see how the program evolves. Right now there are FOUR total applicants, and the submission deadline is June if I recall correctly. None of them are large projects under Article 80. The head of the project begged for large project applicants at a neighborhood meeting last week and they’ve been unsuccessful. So either this is a very modest incentive proposal that will meet some limited goals, or it’s the most incompetent group that has ever tried to shil for a notoriously rich industry that would be thrilled to take government hand outs.

 

[Johnnyrocket891]

Why would the Massachusetts taxpayers be on the hook to subsidizing rents in Boston $4000 when most taxpayers in this state can't even afford to live in Boston?

Are we able to pull the data on subsidized housing at this point?

 

[DBM]

Why would the Massachusetts taxpayers be on the hook to subsidizing rents in Boston $4000 when most taxpayers in this state can't even afford to live in Boston?

Are we able to pull the data on subsidized housing at this point?

What are you talking about? For starters, commercial landlords pay their property taxes to the City of Boston, not the state. I cannot see how the state is involved with Boston's residential conversion program whatsoever, other than providing the zoning classification that allows for it to happen. Yes, the City's property tax haul would drop by a fractional barely perceptible amount if a few very small downtown office towers go through with this conversion program. But how on earth does that involve "Massachusetts tax payers?"

As it stands, Boston is only 9% of the state's entire population, so by definition, the number of taxpayers--obviously limited to Boston--who might get impacted by a reduction in City (not state) services due to a fractional barely perceptible decrease in the City's revenues, is very small, in terms of the entire statewide population.

 

[KCasiglio]

FoxRock Properties Acquires Crown Colony Building - The Quincy Sun

FoxRock Properties, a real estate investment, development, and management firm, on Thursday announced its acquisition of Quincy’s premier office building at 1200 Crown Colony Drive. The 236,491 square foot building is in the highly visible and centrally located Crown Colony Office Park, just a...

thequincysun.com

This cheerleading press release fails to mention an important detail, this building went for $43million in 2018, sells in 2024 for $6million. How long can a sprawling exurb style office park within walking distance of the T survive?

 

[Justbuildit]

Looks like Synergy is absolutely feasting on this downturn, with two big deals in just a couple days. Look at these discounts. This is in addition to a few other deals made over the past couple months, including their purchase of the beautiful 1 Liberty Square.

101 Arch St; last sold at $122M in 2005, just sold for $78M (36% discount)

Another downtown office tower sells at a steep discount - The Boston Globe

101 Arch St. was purchased for $78 million — a price 36 percent lower than the last time it sold in 2005.

www.bostonglobe.com

179 Lincoln St; last sold at $155M in 2020, just sold for $10...(plus the assumption of the $77M debt load); (~50% discount)...this same building sold for $75M back in 2012 so on net it's been flat for twelve years

The $10 Boston office building

In perhaps the most dramatic example of the decline of the Boston office market yet, Triple Net Investor reports a subsidiary of Blackstone last week sold the five-story 179 Lincoln St. at Kneeland Street for just $10 to local developer Synergy. Synergy is actually also paying another $76.5...

www.universalhub.com

If you've got the cash and you think you can bring in some new tenants, go for it.