The St Regis Residences (former Whiskey Priest site) | 150 Seaport Blvd | Seaport

[West]

Re: Whiskey Priest/Atlantic Beer Garden Redevelopment | 150 Seaport Blvd | Seaport

... the fact that it's a public transaction really does throw a wrench into this logic.

Yes, absolutely, fair point.

Cronin's BRA proposal notes that the City can expect $3,600,000 per year in new property taxes (implied net of the current restaurants) from this project. That in addition to the Harborwalk, Seaport Boulevard streetscape/grading/bicycle facilities, the park, and the affordable housing he's funding with the Pier 4 folks.

I get that you can't estimate how much you'd negotiate for, but is the difference between that and $55,000 really meaningful against even the taxes, which are 6,500% of the purchase price EACH YEAR?

You're also getting at fair points here, though you're doing a bit of mixing and matching with the math and so blurring the math some. The $3.6M jump in taxes is partially on the parcels that Cronin owns, above what those parcels pay now, and some of that boost could be gotten without the overhang above the city parcel. But having noted that, I get your point. If we tried to parse this out it would get terribly messy.

As you say, these are negotiations - do you (not you personally, West) want the BRA to have the reputation of pushing each and every deal to squeeze developers of every potential dollar? That doesn't sound like a healthy development climate to me.

Well, speaking only for me... When it comes to the BRA squeezing developers on each and every aspect of development approvals on land that the developers own, no, I do not want them to extract everything possible. Things like good design, increased public benefits, etc, are hard to quantify across varying sites, and as your post implies, Cronin is bringing a lot to the table on the parcel he owns. But when it comes to selling a parcel of city-owned land, even one as otherwise undevelopable as this one, I feel the BRA does have a duty to get as much value as they can without killing the deal (if the deal being proposed is generally good, and I do very much perceive this one to be generally very good). Big emphasis on both sides of that balancing act, between value maximization vs not killing it.

As I noted, maybe they've in fact done this. for example, maybe they traded away $ on the parcel to get better Harborwalk / streetscape / etc than his earlier iterations. If so, they should have no shame in saying how that played out, and I could come around to thinking the $55K was a good deal.

 

[West]

Re: Whiskey Priest/Atlantic Beer Garden Redevelopment | 150 Seaport Blvd | Seaport

That doesn't sound like a healthy development climate to me.

I meant to address this sentence, too. I don't think Boston has had anything remotely like a healthy development climate for my entire lifetime. And the BRA is a big part of that. Sometimes this plays out to the extreme benefit of particular developers as the BRA gives away the farm, sometimes to extreme detriment of particular developers as the BRA capriciously squeezes deals to death, nearly always to the bewilderment of the general public and often to the general public's detriment. Suspicions are deep because they've been so often warranted over the course of time. This does not of course mean all suspicions are true all the time. This includes my suspicions, and I admit the price tag on this parcel set off my bullshit meter without providing me clear proof of bullshit.

 

[Equilibria]

Re: Whiskey Priest/Atlantic Beer Garden Redevelopment | 150 Seaport Blvd | Seaport

The $3.6M jump in taxes is partially on the parcels that Cronin owns, above what those parcels pay now, and some of that boost could be gotten without the overhang above the city parcel.

That depends if he'd have built anything without the overhang, but that's ultimately unknowable.

As I noted, maybe they've in fact done this. for example, maybe they traded away $ on the parcel to get better Harborwalk / streetscape / etc than his earlier iterations. If so, they should have no shame in saying how that played out, and I could come around to thinking the $55K was a good deal.

This is perfectly reasonable in ideal conditions, but less so (to me) in a world where Shirley Kressel exists. I'm all for transparency in Government, and I don't think the burden should be on the public to earn it, but the BRA can be close to 100% certain that anything they publish will be misstated to the public, especially after the Globe already fired the opening shot.

It's like Roger Goodell saying "but if you don't have anything to hide, why not let me interview you" after his lawyer lied about the last guy's sworn testimony to a Federal judge.

 

[JumboBuc]

Re: Whiskey Priest/Atlantic Beer Garden Redevelopment | 150 Seaport Blvd | Seaport

I respect your experience, but the fact that it's a public transaction really does throw a wrench into this logic. Cronin's BRA proposal notes that the City can expect $3,600,000 per year in new property taxes (implied net of the current restaurants) from this project. That in addition to the Harborwalk, Seaport Boulevard streetscape/grading/bicycle facilities, the park, and the affordable housing he's funding with the Pier 4 folks.

I get that you can't estimate how much you'd negotiate for, but is the difference between that and $55,000 really meaningful against even the taxes, which are 6,500% of the purchase price EACH YEAR?

As you say, these are negotiations - do you (not you personally, West) want the BRA to have the reputation of pushing each and every deal to squeeze developers of every potential dollar? That doesn't sound like a healthy development climate to me.

This isn't BRA land that is being sold; it's City of Boston land.

If you take the logic that says "transaction prices are less valuable than tax revenue, so they don't matter" to its natural conclusion, then the City should just give away public land to any abutter who wants to build on it.

The BRA should absolutely not "have the reputation of pushing each and every deal to squeeze developers of every potential dollar", but the City also shouldn't give their land away to developers for a song either. The fair medium here is selling land at as close to market price as possible. That is how nearly all transactions in our society work, and it's what the rules for City land transactions dictate.

And it's not the taxpayers responsibility to help Cronin fund his offsets; if it were, they wouldn't be called offsets. It's Cronin's responsibility to make the numbers for his project work out while paying market price for any land he needs. If one believes that the City should kick in, say, $350k to help build Martin Richard Memorial Park, then we can have that discussion as a democracy. But to give Cronin a $350k discount on the land so that he can more easily "pledge to help finance various civic assets in South Boston" and put money towards the park himself is not the above-the-board or honest way for that to happen.

 

[West]

Re: Whiskey Priest/Atlantic Beer Garden Redevelopment | 150 Seaport Blvd | Seaport

This is perfectly reasonable in ideal conditions, but less so (to me) in a world where Shirley Kressel exists. I'm all for transparency in Government, and I don't think the burden should be on the public to earn it, but the BRA can be close to 100% certain that anything they publish will be misstated to the public, especially after the Globe already fired the opening shot.

Sure, the BRA knows they'll be misinterpreted, I grant that. But if there was a better story, why didn't they fire the opening shot instead of letting the Globe do so? Why didn't they explain how the price was reached proactively, if it was in fact reached via some negotiation? As it ends up looking in the article (which I fully accept might be badly wrong), they got an appraisal just before a Board vote, didn't even review it, and provided preliminary approval of a price based on either nothing (if you believe the Globe) or they were procedurally voting in the price based on some other rationale (if the price was the result of a fuller negotiation and the appraisal was just to "paper it up"). If it was the latter, if there was an actual negotiation, coming out with it now will make themselves look secretive, even if some folks (me, perhaps) will say, "crappy procedures you've got there, but it was a fair bargain all things considered."

The NIMBYs of the world will use whatever they can. If the BRA had some complex negotiation to arrive at the 55K price, and it's going to end up coming out this way, it will count as an own goal of sorts, on process, if not on price. If they really did just vote on an appraisal that hadn't even been reviewed yet, that's an own goal of a different nature, both on process AND price. The NIMBYs will happily count that own goal just like everyone gleefully accepts own goals by opponents, no matter which kind of own goal it was.

 

[Patrick]

Re: Whiskey Priest/Atlantic Beer Garden Redevelopment | 150 Seaport Blvd | Seaport

it's seven o'clock, and the ring leaders already got their jungle riled up.....

http://www.bostonglobe.com/business...eal-seaport/UzD7dseJ37DBda9C7YIl0H/story.html

The CLF is crazy.

The City will benefit more from the tax generated by this site in one year than it would in the next 20 as a sidewalk.

 

[FenwayResident]

Re: Whiskey Priest/Atlantic Beer Garden Redevelopment | 150 Seaport Blvd | Seaport

The CLF is crazy.

The City will benefit more from the tax generated by this site in one year than it would in the next 20 as a sidewalk.

Add another zero to the end of that.

 

[stellarfun]

Re: Whiskey Priest/Atlantic Beer Garden Redevelopment | 150 Seaport Blvd | Seaport

This is the site.

Cronin owns 10515 sq ft (dashed red line around the white)
Massport will provide an easement for 1902 sq ft (shaded green area)
Massport will provide an easement for 1688 sq ft (gray striped area to the east)
Tishman Speyer will provide an easement for 3148 sq ft (gray striped area to the north)
City of Boston would sell 3803 sq ft Triangle parcel (dashed yellow line area)
City of Boston would sell 3928 sq ft Sidewalk parcel (dashed blue line on the south next to Seaport Boulevard.)

The $55,000 appraisal value is for the Triangle parcel.

Cronin's proposed building is 292,000 sq ft. Assuming there are 200,000 sq ft of condos to sell, and using the median sales price at 22 Liberty Drive of $2,500 a square foot, --well, you can do the math. Given the construction cost, $700-800 a square foot?, and adding the soft cost as well, including $1.2 million for the Children's Museum park, we are talking a profit to Cronin of tens, if not of hundreds, of millions of dollars. All made possible because he could buy a sliver of city-owned land for $55,000?

Curious that the only entity willing to sell property to him is the city. I can understand the state not selling, but Tishman Speyer?

 

[bigpicture7]

Re: Whiskey Priest/Atlantic Beer Garden Redevelopment | 150 Seaport Blvd | Seaport

^ what a cluster f of property issues. Thanks for posting this, stellar. Talk about trying to fit a square peg in a round hole. (or shall we say, a semi-eliptic/twisting peg into a rhombic hole).

 

[Equilibria]

Re: Whiskey Priest/Atlantic Beer Garden Redevelopment | 150 Seaport Blvd | Seaport

As it ends up looking in the article (which I fully accept might be badly wrong), they got an appraisal just before a Board vote, didn't even review it, and provided preliminary approval of a price based on either nothing (if you believe the Globe) or they were procedurally voting in the price based on some other rationale (if the price was the result of a fuller negotiation and the appraisal was just to "paper it up").

It's not quite based on "nothing". Cushman and Wakefield was a BRA-approved appraiser (as the Globe notes) and is the leading real estate firm in Boston. I think the current solution - where the applicant pays for a pre-approved neutral party to appraise the property - is exactly the one folks on this thread would propose on a clean sheet. As an expert, you're not in agreement with Cushman's finding, and I can't argue with that, but that doesn't make Cushman biased or even incorrect. They're experts too.

It's not about whether they could have had better information at the time they voted, it's about whether, armed with that (rather unfavorable) appraisal, they should have pushed for more. I suppose the BRA could have had reverse sticker-shock at the low appraisal and tried to negotiate something higher, but this was the process they agreed to, and the overall benefits to the City far outstrip the gains from going back on it.

Personally, I know I'd operate the BRA (or any MA public agency) on the assumption that every number we put out there would be scrutinized by a hostile and under-informed press, but remember the context here. The BRA approves lots and lots of projects. No other Seaport project has been attacked the way this one has (at least since the Fan Pier/FAA stuff), and it all came out of nowhere last week, right before the board meeting. I'm not sure that there would have been person-hours to comb through all the paperwork even if they'd wanted to.

 

[JumboBuc]

Re: Whiskey Priest/Atlantic Beer Garden Redevelopment | 150 Seaport Blvd | Seaport

It's not quite based on "nothing". Cushman and Wakefield was a BRA-approved appraiser (as the Globe notes) and is the leading real estate firm in Boston. I think the current solution - where the applicant pays for a pre-approved neutral party to appraise the property - is exactly the one folks on this thread would propose on a clean sheet. As an expert, you're not in agreement with Cushman's finding, and I can't argue with that, but that doesn't make Cushman biased or even incorrect. They're experts too.

But as West notes, appraisals in situations such as these are worthless. Everyone in the industry knows this.

It's not about whether they could have had better information at the time they voted, it's about whether, armed with that (rather unfavorable) appraisal, they should have pushed for more. I suppose the BRA could have had reverse sticker-shock at the low appraisal and tried to negotiate something higher, but this was the process they agreed to, and the overall benefits to the City far outstrip the gains from going back on it.

Personally, I know I'd operate the BRA (or any MA public agency) on the assumption that every number we put out there would be scrutinized by a hostile and under-informed press, but remember the context here. The BRA approves lots and lots of projects. No other Seaport project has been attacked the way this one has (at least since the Fan Pier/FAA stuff), and it all came out of nowhere last week, right before the board meeting. I'm not sure that there would have been person-hours to comb through all the paperwork even if they'd wanted to.

This isn't a BRA project approval issue! It's a City issue. It's City land, not BRA land, and the final sale is up to the City irrespective of what the BRA says. No other project has been "attacked the way this one has" because no other project has pushed the envelope on as many regulatory issues as this one has. These concerns didn't come out of nowhere just last week; we've known about them from the start. Not to toot my own horn, but I raised all of these concerns, exactly, on this forum back in March:

There appear to be a whole bunch of hurdles (above the Chapter 91 non-compliance) that this one is going to have to clear before becoming a reality. As I read these documents:

- The developer doesn't actually control all of the land that the building is proposed to sit on. The tower has a bigger footprint than the existing buildings, so it'll have to creep a bit onto Massport and Boston property.
- There's no parking.
- There's a significant cantilever over the public sidewalk.

I wish this thing luck in the approval process. It's going to need it.

As far as all the "person-hours to comb through all the paperwork", an appraised value is a pretty easy number to digest. I hope we expect more of our public agencies than to just say "screw it, there's a lot of paper here, let's just hope everything is legit and not bother checking the details".

I'd be interested in seeing the terms that Cronin reached with Massport and Tishman Speyer for the easements over their lands. Massport has always struck me as the shrewdest of the local public agencies when it comes to development issues.

 

[stellarfun]

Re: Whiskey Priest/Atlantic Beer Garden Redevelopment | 150 Seaport Blvd | Seaport

If I am to believe Mr. Chiofaro, Tishman Speyer's easement will not be bought for a song.

Facing default in late spring, and under pressure to sell to Tishman Speyer, Chiofaro refused and instead filed for protection in US Bankruptcy Court in Boston.

"The New York crowd is a gang of pirates," he said in a news release at the time that was bold even for a Boston developer known never to shrink from a scrap. "They take no prisoners; they give no quarter."

http://archive.boston.com/business/globe/articles/2004/12/18/chiofaro_to_keep_stake_in_towers/

 

[Equilibria]

Re: Whiskey Priest/Atlantic Beer Garden Redevelopment | 150 Seaport Blvd | Seaport

But as West notes, appraisals in situations such as these are worthless. Everyone in the industry knows this.

But that's the process you have. In the absence of an independent assessment of value the only option you have is for the City to go around shaking down every developer than comes its way for amounts that are minuscule when compared to the City's overall take. The City shouldn't (and can't) operate like "everyone in the industry". I think we ought to be moving away from the system where developments have to face rounds of difficult individual negotiations to proceed - that's the model that kept Boston stagnant under Menino.

These concerns didn't come out of nowhere just last week; we've known about them from the start. Not to toot my own horn, but I raised all of these concerns, exactly, on this forum back in March.

You having foreseen the issues is different from them being inevitable. These issues were going to be resolved. Cronin was going to have his land and his easements, and he was going to be going to DEP for his approval there. In the last week, CLF decided to file an illogical lawsuit neglecting the spirit of the rule, and the Globe seized on a line item to get NIMBY clicks.

As far as all the "person-hours to comb through all the paperwork", an appraised value is a pretty easy number to digest. I hope we expect more of our public agencies than to just say "screw it, there's a lot of paper here, let's just hope everything is legit and not bother checking the details".

My point wasn't that it's hard to digest, it's that it's a single number among hundreds of pages of paperwork. I'm not arguing that they didn't check the details, I'm arguing that they couldn't have foreseen which of those many details they'd need to be ready to defend from the pitchforks.

 

[JumboBuc]

Re: Whiskey Priest/Atlantic Beer Garden Redevelopment | 150 Seaport Blvd | Seaport

But that's the process you have. In the absence of an independent assessment of value the only option you have is for the City to go around shaking down every developer than comes its way for amounts that are minuscule when compared to the City's overall take. The City shouldn't (and can't) operate like "everyone in the industry". I think we ought to be moving away from the system where developments have to face rounds of difficult individual negotiations to proceed - that's the model that kept Boston stagnant under Menino.

Again, this isn't a BRA project approval issue. This is an issue of selling City land. I bet that 95%+ of development projects do not involve the sale of City land to developers.

We should absolutely streamline, codify, and simplify the project approval process as much as possible. But the sale of City land to developers is not part of this process. It is a completely separate issue. Land prices are negotiated and agreed upon every single day in the private sector, and this is a very developed industry; the City should emulate it. Compare this to what the BRA usually does--approve projects--which is strictly confined to the public realm.

 

[Equilibria]

Re: Whiskey Priest/Atlantic Beer Garden Redevelopment | 150 Seaport Blvd | Seaport

Again, this isn't a BRA project approval issue. This is an issue of selling City land. I bet that 95%+ of development projects do not involve the sale of City land to developers.

We should absolutely streamline, codify, and simplify the project approval process as much as possible. But the sale of City land to developers is not part of this process. It is a completely separate issue. Land prices are negotiated and agreed upon every single day in the private sector, and this is a very developed industry; the City should emulate it. Compare this to what the BRA usually does--approve projects--which is strictly confined to the public realm.

Sorry, but I don't agree. The BRA is just a City department. I realize that in the Winthrop Square case the land was explicitly transferred to the BRA, but the revenue and benefits provided by this project accrue to the City, not to the BRA. Public parks are not owned by the BRA. Low-income housing is not managed by the BRA. Yet, the BRA negotiates agreements by which developer benefits flow to those departments.

95% of projects don't involve a lot of things, but that doesn't mean that each of those eccentricities should become a bureaucratic obstruction just because one department or another can be used to end-around a supposedly streamlined process.

 

[JeffDowntown]

Re: Whiskey Priest/Atlantic Beer Garden Redevelopment | 150 Seaport Blvd | Seaport

I think a major point that is missed in this debate is that the City-owned triangle of land is WORTHLESS without this project. No one else is going to buy it. There is no market for the parcel.

So whatever the sale value, it is all upside for the City.

 

[stellarfun]

Re: Whiskey Priest/Atlantic Beer Garden Redevelopment | 150 Seaport Blvd | Seaport

Cronin's appraiser valued the Triangle parcel at $14.50 a square foot.

The assessed value for Cronin's land is about $111 a square foot. (Cronin's 10,500 sq ft is made up of three parcels, so $111 is the assessment averaged for all three combined.)

Tishman Speyer will lease to Cronin 3,148 sq ft. This is land that is submerged either intermittently or continuously by tidal flow. The land parcel containing the land to be leased is 128,400 sq ft.; it appears that at least 40 percent of this parcel is under water. (Most of the part that is submerged is submerged 24/7; a small part nearest Whiskey Priest may be exposed at low tide.) The land-land portion of the parcel is Anthony's former parking lot.

The assessed value of the Tishman Speyer parcel described above is $177 a square foot. (As there are no building improvements on this land, that's the value the city's assessors placed on the parking lot.)

There is another parcel on Seaport Boulevard, no number, but identified as Parcel D. It is also a parking lot(s), as the assessor's record shows no building improvements on the land. The assessed value is $634 a square foot.

Tishman Speyer's taxes on the portion of the parcel it will lease to Cronin are about $15,000 a year. (If the city of Boston's Triangle parcel were taxed at the Tishman Speyer tax rate, revenue would be about $18,000 a year. Which is close to what Cronin pays the city.)

One point in the most recent Globe article is that the Cushman Wakefield appraised value for the Triangle parcel was not provided to the BRA before their approving vote. All I can say is that if I could buy property at a 3x multiple of the annual taxes on that property, I'll be at your door, like yesterday.
______________________________
Another way of determining the value of the Triangle parcel is for the city to auction it, and let the auction determine the market value. I don't think most cities or towns sell city/town property as a private sale, unless the property is land-locked.

 

[JeffDowntown]

Re: Whiskey Priest/Atlantic Beer Garden Redevelopment | 150 Seaport Blvd | Seaport

^ just a caution about parking lots and assessments. Parking lots (and garages) are assessed based on the business revenue potential from parking, not based on the buildable value of the land. So they often have really screwy assessments in Boston (because parking revenue is so lucrative), and would never assess at the same value with a building placed on them.

 

[JANAM]

Re: Whiskey Priest/Atlantic Beer Garden Redevelopment | 150 Seaport Blvd | Seaport

From the BRA:

https://twitter.com/BostonRedevelop/status/765908245374496768

The assessed values for land quoted above are for permitted parcels with millions of square feet approved. The sliver parcel can never be built on (unless you spend $20M to move the 115KV line).

 

[FenwayResident]

Re: Whiskey Priest/Atlantic Beer Garden Redevelopment | 150 Seaport Blvd | Seaport

From the BRA:

https://twitter.com/BostonRedevelop/status/765908245374496768

The assessed values for land quoted above are for permitted parcels with millions of square feet approved. The sliver parcel can never be built on (unless you spend $20M to move the 115KV line).

Surprise surprise! There are other factors that go into land value beyond square footage and location! Who would have thought?