Re: Trans National Place (Winthrop Square) Part 2
Credit crisis hits big Hub projects
Some towers being built but many stalled
By Thomas Grillo
Sunday, November 16, 2008 - Added 11h ago
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Boston is in the midst of a credit crisis that has slowed most commercial real estate development to a halt.
A handful of projects were lucky enough to secure financing before lenders got jittery. Others are seeking to fill their yet-to-be-built office buildings while the rest are stalled.
At stake are $16 billion in deals that would add millions of square feet of office space, plus hundreds of hotel rooms and luxury condominiums to the downtown.
The projects include the Government Center Garage redevelopment, a luxury hotel in the Theater District and Fenway Center, the transit-oriented development to be built above the Massachusetts Turnpike in Kenmore Square.
The W Hotel was one of the lucky projects. The 26-story, 350,000-square-foot hotel is expected to open in August and construction crews are already installing windows and readying the tower for interior work.
The Clarendon, a 350-unit combination of rental and condominiums across from the John Hancock, will hold a topping off ceremony on Tuesday, a symbolic event that celebrates installation of the final piece of steel.
Despite persistent rumors that construction on the first office building at Fan Pier is expected to be put on hold, the project?s financier insists that the 500,000-square-foot Class A office space is on target for completion. But possible tenant Vertex Pharmaceuticals is reportedly backing away from committing to a second, as-yet-unstarted, Fan Pier building.
Reed S. Woodworth, vice president of PFK Consulting, a New York-based firm that tracks hotel development, said that timing is everything. ?If a developer had not broken ground three months ago, they will probably be delayed until the credit markets open up again,? he said.
Construction was expected to commence earlier this year at South Station for a 1 million square-foot development at the transit hub. But plans for a 40-story office tower and two smaller buildings that will contain a hotel and condominiums are on hold until the credit markets open.
?There is no financing today, so we are not spending much time on that,? said David Perry, senior vice president at the developer, Houston-based Hines. ?We are waiting until credit frees next year. In the meantime, we are talking to potential tenants.?
But so far, there have been no takers for the office space, Perry said. ?There?s an abundance of caution among tenants who are seeing their economic future growing increasingly uncertain and they?re hesitant about making space commitments,? he added. ?Until such time that there?s more clarity on the depth and length of the recession, everyone will take a wait-and-see attitude.?
cw0 So far, plans for a 1,000-foot tower at Winthrop Square championed by Mayor Thomas M. Menino have stalled. Sources say the project is dead and that Steven Belkin, chairman of Boston-based Trans National Properties, probably will never build the city?s tallest tower.
Crews building One Franklin Street, the $700 million Filenes?s redevelopment, have disappeared from Washington Street. The 39-story mixed-use project, which is expected to transform Downtown Crossing with office, hotel, residential and retail space, is on hold until John Hynes, the developer, can secure more financing.
Still, Menino remains optimistic, saying that Boston is not immune to the global credit crunch.
?Any delays in projects have nothing to do with Boston. This is happening everywhere,? he said. ?But I?m confident that when the credit becomes available, these projects will get back on track.?
So tommy tower is now dead. I blame half of this on bad planning on the major's office.The other half on the economy.[
