Stalled project has Hynes on hot seat
Ex-Filene?s site still lacks investors
By Casey Ross, Globe Staff | August 10, 2009
Every time he steps out of his door, John B. Hynes III knows someone will ask him about the massive hole he opened up in downtown Boston.
Hynes is the man behind the stalled $700 million redevelopment of the Filene?s block, one of the city?s largest commercial real estate ventures. If not from City Hall, Hynes said, he?ll get questions from a Back Bay neighbor or a business owner - or even from friends when he eats at Pate?s, his favorite Cape Cod steakhouse.
?When I walk in there, I know that before I leave somebody is going to say something about Filene?s,?? Hynes said. ?I just can?t give people a timetable. What I can say is that once the economy turns around, we should be one of the first projects out of the ground.??
Until he gets the Filene?s project going again, Hynes will be known as the guy who left a key block in Boston?s central shopping district looking like a war zone, with the half-demolished shells of buildings looming over crowds of passersby. This dubious distinction drives him daily to seek new investors, often rising before dawn to make 4:30 a.m. phone calls to business people on the other side of the world.
Last week, he was in South Korea, where his firm, Gale International, is building the $35 billion New Songdo City near Seoul, a 1,500-acre development that will be bigger than downtown Boston and include more than 22,500 housing units, a 2,100-student international school, and a golf course designed by Jack Nicklaus.
Between meetings about that project, Hynes works to drum up interest in the Filene?s site. He has mailed solicitations to potential investors in China, Japan, Thailand, Hong Kong, and elsewhere in Asia. He?s also met with potential investors in Boston and Seoul, where he travels at least once a month.
?No one is giving up here,?? Hynes said. ?There is too much invested. We are going to get this done.??
Hynes, 51, has worked in Boston real estate for 30 years and has become one of the city?s most influential developers. He built the $350 million One Lincoln Street tower on speculation, eventually signing the biggest lease in Boston?s history, a 20-year deal with State Street Corp. for the entire 36-story building.
He is also trying to build Seaport Square, a 20-block development on the South Boston Waterfront that would include residences, offices, stores, and public parks.
He has five children, his family name on one of the city?s convention centers, and a love of hockey and baseball. In college, he was recruited to play catcher for Harvard University?s baseball team, but ended up winning the goalie?s job on the hockey team as a walk-on and later becoming its captain.
In sports, his positions required improvisation and poise, qualities that have been critical in the battle to build Filene?s.
He was forced to revise elements of the project as the economy and real estate market changed during the past two years. The most recent version is a slender 32-story tower at the corner of Washington and Franklin streets with retail stores, luxury hotel, and several floors of offices. He dropped 166 condominiums due to the slowing residential market. He began construction in February 2008, only to stop five months later, when one of the banks that had pledged to fund the project withdrew, and two others cut their commitments by half.
Hynes is the son of longtime TV news anchor Jack Hynes and the grandson of former Mayor John B. Hynes, who created the Boston Redevelopment Authority and launched the city?s urban renewal in the 1950s. Though no politician, he possesses an everyman?s touch and an instinct for self-deprecating humor. He freely acknowledges the irony of Filene?s, the development he said would create a ripple effect of economic development but instead has become a symbol of the recession.
?We were supposed to be the rock in the pond,?? he said. ?Unfortunately, now we?re the hole.??
One night in April, Hynes attended a meeting of downtown residents and business people, anticipating that his project would be the target of some frustration. As pointed questions arose, Hynes stood and apologized, acknowledging the neighbors? concerns about the ugliness of the site and its impact on area businesses.
?He was very sincere and open,?? said Rosemarie Sansone, executive director of the Downtown Crossing Partnership, a business association. ?He just assured people he?s doing everything he can conceive of to bring the project to fruition.??
It wasn?t enough to placate some business owners.
?It?s certainly not helping business traffic to have nothing there,?? said Fred Rosenthal, owner of Bromfield Pen Shop, which sits a block away from the remains of the Filene?s building. ?Something should be done out there, but I don?t know much about his financial situation.??
From City Hall, Mayor Thomas M. Menino continues to prod Hynes to make the construction site less of an eyesore. Menino wants Hynes to drape tarps over what?s left of the original Filene?s building and another partially demolished building to protect them from the weather, and take other steps to spruce up appearances, especially since the city launched a weekly arts and music festival this summer to enliven the area.
?We?ve held a lot of events down there, but they?ve got to do their part,?? Menino said. ?They?re not fulfilling their commitment to the City of Boston at all.??
Hynes is walking a fine line. To appease the mayor he would have to spend millions buttoning up the site, possibly sending the wrong message to potential investors that the project is going nowhere. If he holds off cleaning up, he risks further alienating Menino and others whose support he would need if he decides to again change elements of the development.
Hynes said the Filene?s dilemma is among the toughest of his career. Winter is just a few months away, and he is losing precious prime construction time. The primary office tenant he had lined up, law firm Fish & Richardson, has pulled out because of the delays. Another anchor tenant, Filene?s Basement, has new owners who are considering relocating the famed discount department store to another location downtown.
Hynes?s new goal is finding investors who can bring cash to the project, thereby lowering what he and partner Vornado Realty Trust would have to borrow from banks. If he doesn?t get financing by October, Hynes said, he will take steps to protect the site during the winter. In the meantime, he has seven more weeks to hit the phones.
?We don?t want to play defeatist yet,?? he said. ?It?s hard to play to win when you?re playing defense. In fact, it?s impossible. We want this fixed more than anyone can know, and we?re working on it every day.??
