Millennium Tower (Filene's) | 426 Washington Street | Downtown

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Re: Filene's

Boston.com - September 24, 2010
New pitch for former Filene?s site
Developers seek to sell for rental units, stores


By Casey Ross, Globe Staff | September 24, 2010

Owners of the downtown site of the former Filene?s department store are putting the property up for sale, just as city officials said they will take the unprecedented step of revoking the project?s permits next week following a two-year delay in construction.

The turn of events raises the possibility of new life for the fallow property, where there are now skeletons of half-demolished buildings lining a massive crater that had been dug for the foundation of a once-planned 39-story tower.

Instead of the $750 million office-condominium complex they failed to build, developers Vornado Realty Trust of New York and John B. Hynes III are marketing the Filene?s block as ideal for apartments and stores. Potential buyers are already coming forward.

?It?s an intriguing opportunity, and we?re interested in it,?? said Bill McLaugh lin, an executive with AvalonBay Communities Inc., one of the region?s largest apartment builders. He said the firm has not made a bid, but is eyeing the property as well as other sites in Boston. ?We?re very positive about the strength of the rental market. It could not be a more opportune time.??

The developers declined to comment yesterday. But the broker handling the sale for them yesterday said Hynes and Vornado had anticipated the loss of the permits and so are aggressively pitching potential buyers various development scenarios that involve hundreds of apartments and retail stores, with only a small component for office space.

?We?re very excited about this new concept,?? said the broker, Robert Griffin, managing director of Cushman & Wakefield. ?We have people who want to buy the site, people who want to build on it, and people who want to lease the space.??

Hynes and Vornado have so far spent more than $150 million buying the property and preparing it for construction. However, they have not disclosed their asking price.

Converting more of the property to retail use also raises the possibility of a return of the original Filene?s Basement, which closed after nearly a century in that location in anticipation of construction and has not reopened elsewhere in the downtown neighborhood since the project stalled.

?We definitely hope to have the opportunity to open a store in the original location,?? said Marcy Syms, chief executive of Syms Corp., which owns Filene?s Basement.

Depending on the bids they receive, Hynes and Vornado could either sell the property outright or just a portion and remain part of the development team. If they stay on the project, Hynes and Vornado would probably assume a less-public role given their turbulent relationship with the city.

Mayor Thomas M. Menino has sharply criticized the team for leaving the construction site idle, fearing the gaping hole in the ground is undermining his goal of reviving the Downtown Crossing district.

The Menino administration yesterday said it will revoke Hynes and Vornado?s existing permits effective Monday, the city?s three-year deadline for approved projects to be under construction.

City officials said they could not remember another instance where they pulled permits on a privately owned development site, and are doing so in this case only because of the property?s critical location downtown ? and because its developers have not been able to resume construction.

?It is abundantly clear to us that the developers are ill-equipped to execute the project as it was approved,?? said Boston Redevelopment Authority director John Palmieri. ?And the blight that exists there is unprecedented. It sits in the middle of a historic shopping district and retail center where we?ve been spending a lot of money to bring renewal.??

The revocation appears to be a strategic move by city officials to force Hynes and Vornado into action. Ultimately, it will have little impact on the overall scope of what gets built, as Palmieri said yesterday the city would still support a large-scale project there.

?If a developer comes forward with a program close to the one we approved, we would be in a position to conduct a review very quickly,?? Palmieri said.

The original redevelopment plan for Filene?s was approved in 2007, but Hynes and Vornado stopped work on the site in June 2008, when the credit crisis and economic downturn dried up funding for large building projects, especially those with luxury condominiums and offices as main components.

But the market for new apartment buildings and stores is much stronger, according to local real estate officials, making it likely that the Filene?s property will draw multiple bidders.

?There is a surprising amount of [funding] available for apartments right now,?? said George Fantini, principal of the mortgage banking firm Fantini & Gorga. ?And this is a great location because of its access to transportation and for so many other reasons.??

The property is connected to the Downtown Crossing MBTA station at the corner of Washington and Franklin streets. Before the economic downturn, the area saw rapid redevelopment that added hundreds of condominiums, new college dormitories, refurbished theaters, and several new restaurants.

While the Filene?s site is attracting heavy interest, selling it could still prove difficult. Fantini said the biggest sticking point will be price, as buyers are looking to take advantage of distress in the real estate market to pick up properties at bargain prices.

?Apartments and retail make sense there, but if the land is priced too high it would break the back of the deal,?? Fantini said. ?That?s going to be the challenge.??

Jenn Abelson of the Globe staff contributed to this report. Casey Ross can be reached at cross@globe.com.
 
Re: Filene's

Does the sale come with the design? What are the chances we will lose the remaining parts of the building?
 
Re: Filene's

Developer doubtful buyer will emerge for Filene?s site
By Thomas Grillo
Friday, September 24, 2010


The developer of the stalled former Filene?s project in Downtown Crossing said he doubts the controversial site can be sold.

?There?s some interest out there, but I honestly don?t think a real buyer exists,? said John Hynes, CEO and managing partner of Boston Global Investors. ?I suspect we?ll get offers from $30 (million) to $50 million, but those numbers don?t work. Our goal is to try to find a buyer or an equity investor.?

Hynes, the local face of the project, said majority owners Vornado Realty Trust and J.P Morgan have hired a commercial real estate brokerage firm to sell all or part of the controversial development on Washington Street.

?We prefer to finish the project ourselves,? Hynes said. ?But in an effort to accelerate construction, starting today we are also going to make it available to someone who thinks they can do it faster than we can.?

Vornado and J.P Morgan paid $100 million for Filene?s in 2007. Vornado paid an additional $16.8 million to terminate the Downtown Crossing lease with Filene?s Basement. That year, construction (or at least demolition) began on One Franklin, the $700 million project that would include a 39-story tower with 300,000 square feet of retail space, a new Filene?s Basement store, a 280-room hotel, 475,000 square feet of office space and 166 condominiums. But construction was halted months later when the credit markets made financing impossible, according to the developers.

Hynes and Vornado have been under pressure for more than a year from Mayor Thomas M. Menino to fill the gaping hole at the former Filene?s site. But despite talk among lenders that money is available, large projects have gone begging, say developers. Hynes said he doubts any other development team can get it done faster.

Dot Joyce, a spokeswoman for Mayor Thomas M. Menino, said the city will revoke the permits on Monday for the Filene?s project. ?If they want to build something, they would have to start the process all over again,? she said. ?Presumably, without the approvals for a building project, the site is worth a lot less. We want to see something happen there, no matter who does it.?


Link
 
Re: Filene's

The developer's are loosing money on this right now correct? If that isn't enough for them to sell it at a loss, maybe the city can charge them some blight penalty that will make them more enticed to cut their loses.
 
Re: Filene's

The developer's are loosing money on this right now correct? If that isn't enough for them to sell it at a loss, maybe the city can charge them some blight penalty that will make them more enticed to cut their loses.

Don't worry it's actually the United States taxpayers that are losing money since they bailed out JP Morgan.
 
Re: Filene's

Don't worry it's actually the United States taxpayers that are losing money since they bailed out JP Morgan.
Once again revealing your solid grasp of investment fundamentals and investing.

JP Morgan Chase repaid the entire amount of its TARP bailout money over a year ago. And JP Morgan Chase paid the government more than had been 'borrowed', so the government and the taxpayer made money off the deal.

http://www.jpmorgan.com/cm/cs?pagen...ge_Template&cid=1159389444475&c=JPM_Content_C
 
Re: Filene's

Once again revealing your solid grasp of investment fundamentals and investing.

JP Morgan Chase repaid the entire amount of its TARP bailout money over a year ago. And JP Morgan Chase paid the government more than had been 'borrowed', so the government and the taxpayer made money off the deal.

http://www.jpmorgan.com/cm/cs?pagen...ge_Template&cid=1159389444475&c=JPM_Content_C

And how much did AIG actually owe JP Morgan? And how many shares of GM did JP Morgan Chase Own?

Don't forget about zero percent interest rates that the Federal Reserve continues to promote. Free money to our beloved bankers as the worker class become the working suckers with less buying power.
 
Re: Filene's

And how much did AIG actually owe JP Morgan? And how many shares of GM did JP Morgan Chase Own?

Don't forget about zero percent interest rates that the Federal Reserve continues to promote. Free money to our beloved bankers as the worker class become the working suckers with less buying power.

Whatever shares JP Morgan Chase owned in GM were wiped out when GM declared bankruptcy. So no taxpayer bailout of GM stockholders.

AIG probably didn't owe JP Morgan Chase anything. JP Morgan Chase was a counterparty to Goldman on CDSs. In any event AIG is on a path to repay its bailout money as well. Because they got so much, they are taking longer than the others. The Feds own 80 percent of AIG at this point, and the current share price is $36 and change.

Well if current interest rates were more typical of those in decades past, Chiofaro's and your dream of an iconic tower would be even more separated from reality.
 
Re: Filene's

Whatever shares JP Morgan Chase owned in GM were wiped out when GM declared bankruptcy. So no taxpayer bailout of GM stockholders.

.

Who do you think was selling when the GOVT was buying the stock?

Not your retail shareholder
 
Re: Filene's

Who do you think was selling when the GOVT was buying the stock?

Not your retail shareholder

The government bought no GM stock before bankruptcy. The government received GM stock, newly issued, after bankruptcy when it gave GM some of the TARP money.
 
Re: Filene's

Meanwhile, Hayward Place, Nashua St. Residences and Kensington sits unbuilt 4 years after approval. Why aren't their permits yanked?
 
Re: Filene's

Maybe because those are 'just' vacant lots and not huge holes in the ground behind possibly unstable historic fa?ades?
 
Re: Filene's

We should just go through with the plan to plant some grass seed and plop some sheep down in the hole. DTX will be like, super awesome dude.
 
Re: Filene's

Why can't the BRA admit the Developers paid too much for land?


Developer doubts that Filene?s project will be sold
Filene?s de-basement
By Thomas Grillo
Saturday, September 25, 2010 - Added 9 hours ago
+ Recent Articles


E-mail Print (3) Comments Text size Share Buzz up!The developer of the stalled former Filene?s site in Downtown Crossing said he doubts the controversial project, which has been put up for sale, can fetch a high enough price to make a deal worthwhile.

?There?s some interest out there, but I honestly don?t think a real buyer exists,? said John Hynes, chief executive and managing partner of Boston Global Investors. ?I suspect we?ll get offers from $30 (million) to $50 million, but those numbers don?t work.?

The move comes as the city vows to review the project?s permits, possibly revoking them and making it harder for the current developers to proceed.

Hynes, the local spokesman for the project, said majority owners Vornado Realty Trust and J.P Morgan have hired a commercial real estate brokerage firm to sell all or part of the controversial development on Washington Street.

?We prefer to finish the project ourselves,? Hynes said yesterday. ?But in an effort to accelerate construction, starting today we are also going to make it available to someone who thinks they can do it faster than we can.?

Vornado and J.P Morgan paid $100 million for the Filene?s site in 2007. Vornado also paid $16.8 million to terminate the Downtown Crossing lease with Filene?s Basement and about $50 million more on demolition.

The proposed $700 million project, known as One Franklin, was supposed to include a 39-story tower with 300,000 square feet of retail shops, a new Filene?s Basement store, a 280-room hotel, 475,000 square feet of office space and 166 condominiums. But construction was halted when the credit markets made financing impossible, according to the developers.

Hynes and Vornado have been under pressure for more than a year from Mayor Thomas M. Menino to fill the gaping hole left at the site in the heart of Downtown Crossing. But despite talk among lenders that money is available, large projects have gone begging, the developers say. Hynes said he doubts any other development team can get it done faster.

Two sources told the Herald yesterday that Boston Residential Group, which won praise for a pair of luxury residential projects on Newbury Street and Columbus Avenue, is interested in buying the Filene?s site. Curtis Kemeny, the firm?s chief executive and president, did not return calls seeking comment.

John Miller, senior vice president at Lincoln Property Co., said there will be interest in the Filene?s site, but it will sell for a lot less than the development team has invested.

?In 2007, we were in the midst of a frothy office market and every segment of the market - hotel, residential, office and retail was better,? he said. ?Today, you can?t justify building an office building. There?s no condo market and hotels are hard to finance.?

It?s possible that Vornado and J.P. Morgan just want out of a project that has been steeped in bad publicity, Miller said. ?They don?t have much else invested in the city and if they can get out on par or something close to it in a sale, then maybe it?s time,? he said.

Lisa Campoli, a managing partner at Colliers Meredith & Grew, said if a new owner can buy the site for far less than the original investment, they could get important support from the city to jumpstart construction. ?If they could make the numbers work, one of the pluses would be enormous political support to make something happen,? she said.

In a draft letter dated Sept. 27 that the city plans to send to Hynes and Vornado chairman Steven Roth, BRA director John Palmieri told the development team that city ?has been extremely frustrated that work on the project has ceased? and they will review the development to decide whether the team has to commence the city?s approval process again.

Jessica Shumaker, a BRA spokeswoman, said when considering the project over the next few weeks, the city will not take into account that the site is up for sale.

http://bostonherald.com/business/real_estate/view.bg?articleid=1284071
 
Re: Filene's

Meanwhile, Hayward Place, Nashua St. Residences and Kensington sits unbuilt 4 years after approval. Why aren't their permits yanked?

also did the developers of those parcels tear down one of the largest tourist attractions in the city? Like it or not, the Basement brought in a ton of tourist traffic. I have worked on the outskirts of downtown crossing for well over a decade now and I can't tell you how many times I was stopped by tourists asking for directions to the Basement. But your point is not lost. Menino, like nearly every politician, has his favorites and if you aren't one of them, good luck to you.
 
Re: Filene's

I still wonder why Filene's Basement didn't try to temporarily relocate to the former Barnes&Noble site.
 
Re: Filene's

They did, but the landlord there didn't want to rent to them. I don't know why.
 
Re: Filene's

Wasn't it because he thought he could get higher rent from some other tenant?

The invisible hand has been pretty brutal to DTC.

Let's hope it's future doesn't look like my former hometown's ped mall...

BIGCITY-articleLarge.jpg
 
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