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Wed, Dec 12
A Compendium of Property & Capital News
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Dec 12
A Compendium of Property & Capital News

Breaking // Skanska USA Confirms Sale of 101 Seaport Blvd. To German Firm

April 12, 2016

By Joe Clements

BOSTON—Oh, Yes, they did. After steadfastly denying its Seaport District office tower was on the block at all last autumn and this past month denying therealreporter.com story that a German investment fund had 101 Seaport under agreement for a potentially record price per sf, Skanska USA confirmed this morning it has traded the gleaming 17-story building to Union Investment after a campaign orchestrated by the Robert E. Griffin Jr. team at Newmark, the final result of $452 million equating to $1,027 per sf, a few dollars north of the previous high-water rate of 222 Berkeley St. and 500 Boylston St. that fetched $1,024 per sf for that $1.2 billion exchange that came in 2015.

“We are thrilled with the outcome,” Newmark’s US Head of Investments Robert E. Griffin Jr. tells therealreporter.com, his contingent also led by Edward C. Maher Jr. and Matthew E. Pullen. The effort drew eager high-powered candidates from across the globe clamoring for a rare LEED Platinium commercial building whose tenant roster is anchored by accounting giant PricewaterhouseCoopers, a firm which committed to occupy a property lauded for its space efficiencies and style. According to Griffin, the mix of building quality, strong sponsorship and location in one of the country’s hottest office markets contributed to the broad response.

“We are certainly encouraged by the market interest which came from all over the world, and I think it sends a strong and powerful statement about how well-regarded Boston is today,” says Griffin, who declined to discuss metrics of the transaction which industry watchers maintain included a capitalization rate in the the lower 4 percent range.

The Newmark contingent that advised Skanska USA is familiar with Union Investment, having aided that entity in the recently completed purchase of Lovejoy Wharf in the North Station district, now headquarters of Converse. The same team has also done extensive business in the Seaport arena that has seen dozens of buildings change hands over the past two years, among them the $317 million sale of State Street Bank’s headquarters to Tishman Speyer that Griffin and crew completed in 2015.

In a prepared statement, Tal Peri, the head of Union Investment’s US East Coast & Latin America territories pointed to the North Station purchase and another one of the Godfrey Hotel as examples of its interest in Boston, adding, “we are pleased to have strengthened our foothold in the important and economically very stable gateway market of Boston with the acquisition of this trophy building at 101 Seaport Blvd.” Peri’s operation is based in New York City.

Besides the Newmark Capital Markets team, Skanska USA principals credit the Newmark leasing duo of Bill Anderson and David Martel for their efforts in filling 101 Seaport. Skanska USA Commercial Executive VP Charley Leatherbee calls the tower “a catalyst for the transformation of the neighborhood” and notes the firm has two more Class A ventures nearby, those being 121 Seaport Blvd. and Watermark Seaport. On the just-harvested project, Leatherbee says that “the building, its elegance and its environmentally concious design both inside and out reflect our passion for the community, the Seaport and the city of Boston.”

On the sustainabilty front that earned the Platinum LEED, Skanska USA incorporated such elements as green roofing, a rainwater collecting system and chilled-beam cooling system—the first of its kind locally that helped the structure use 50 percent less energy and 40 percent less water than its peers. Catering to the occupants, 101 Seaport has 10-foot ceilings with windows top to bottom, providing for unobstructed views of Boston Harbor and downtown while introducing substantial natural light to the tenant space.

Skanska’s successful execution of its strategy for 101 Seaport Blvd. will be among the topics on tap for today’s Top of the Market Program being held this afternoon at the Intercontinental Hotel in Boston by Newmark and its entire staff feting the 17th annual market forecast held by the Griffin team, this the first time at Newmark following several years at Cushman & Wakefield. As today’s Real Reporter outlines, over $1 billion of new CRE listings will also be revealed to the audience estimated to be upwards of 400 people for the event. The Real Reporter story says 70 Federal St. is among the listings being announced. Griffin declined to discuss future business in advance of the invite-only program.

The Newmark team and other parties involved had been unable to discuss 101 Seaport’s progress prior to the closing, including therealreporter.com story in early November revealing Skanska USA had opted to divest the building just three years after breaking ground on the self-financed venture. Then on March 13th, therealreporter.com identified Union Investment as the winning bidder and quoted sources portending a price in excess of $450 million. The owner denied that article as well, although Real Reporter has stood by both prior stories.