128 CRE Tabbed for Lease/Sale Exclusive of 62,000-SF Boston Sports Club Site in NewtonNovember 07, 2019 — By Joe Clements
NEWTON—After three previous trades already this millennium, a re-purposed tennis facility here at 135 Wells Ave. is being served up again, this time as a leasing or sale opportunity through commercial real estate firm 128 CRE, with unofficial pricing estimates between $18 million and $20 million for the latter option of the 62,000-sf structure presently held by a private investor and 100 percent occupied by Boston Sports Club until 2023.
“It is a unique property offering incredible flexibility in a location that gets more dynamic every day,” relays 128 CRE founding principal Jeremy A. Freid, SIOR, his locally based brokerage firm just now launching the listing. Freid provides multiple possibilities a buyer could pursue, including re-signing BSC to the entire footprint or “right-sizing” the fitness center to a smaller amount and creating a multi-tenanted asset; adapative re-use of the property into an academic setting; lab/medical product; corporate and traditional office space; and even a complete tear-down and replacement of the property that dates to 1973.
Based in Newton, 128 CRE was engaged by owners G&Z Real Estate Investment LLC to evaluate prospects for a building acquired two years ago next month for an even $15 million, with marching orders to consider a wide berth of ideas from their client continuing to enjoy healthy cash flow through lease maturity or proactively negotiating a “blend-and-extend” deal with the solid-credit denizen. The brokerage shop is also calculating chances of finding a new tenant if BSC departs ando/or an outright disposition of 135 Wells Ave. to take advantage of a hot climate for inner-suburban real estate, especially such a large infill site such as 135 Wells Ave. that encompasses 6.3 acres.
“We looked at every scenario we could think of and find there are a host of ways you can go for this particular situation,” explains Freid, who credits the hybrid approach to a “hands-on, entrepreneurial” mindset of the client, one that makes G&Z principals comfortable to pen the next chapter for 135 Wells Ave. on their own while also recognizing conditions are ripe for securing a rewarding return on its short-term stewardship. “I think they have a good understanding of what they would consider a fair return to be,” says Freid, whose team will entertain offers as they roll in for both leasing and sales; should one concept exceed others, that will be pursued individually, and should the action lead towards a close competition among investors, there could be a call for offers. “We are reaching out in many directions and are ready to respond to whatever comes of it,” Freid says, hearkening back to the flexibility element of his firm’s assignment.
Joining Freid on the campaign are fellow Senior Partners Douglas Adamian, Adam T. Meixner and Jordan B. Sneider as well as Advisor Tyler J. Capecci and Client Services Director Meghan Huebner. The listing is being pitched minus pricing guidance on the sales portion, but industry observers familiar with the property maintain its stability and a robust inner suburban west market could push multi-million dollar bidding into the high-teens or even approaching $20 million.
“You can’t beat the location . . . and it’s in the strike zone of a lot of investors,” relays one CRE professional in predicting sellers will “definitely take notice” of the listing while recalling a prior owner had targeted 135 Wells Ave. mid-decade as a redevelopment play, that concept ultimately faltering when city officials fought a proposed residential plan in court and prevailed.
Along those lines, prospects who might balk at considering 135 Wells Ave. over fear another project could meet local resistance may be mollified from a shared effort between Newton and neighborhing Needham to promote commercial density in their so-called N2 District straddling both communities just off Route 128/Interstate 95 at the revamped Exit 19 whose infrastructure and routing upgrades have improved access substantially.
According to informational materials obtained by Real Reporter in advance of its launch, 135 Wells Ave. “provides a myriad of repositioning opportunities that the city of Newton would be open to, including office, retail, medical, life science or biotech.” Newton Wellesley Hospital recently redeveloped two parcels in the Wells Avenue Business Park where 135 Wells Ave. is situated, 128 CRE recounts, adding Newton is even promoting an up-zoning of the N2 footprint to encourage higher density of sites along Wells Avenue.
To help visualize the possibilities, 128 CRE has multiple scenarios in its informational package ranging from the multi-tenanted re-use concept plus new two-story and three-story office formats including structured parking, that aspect enhancing the 160 surface spaces presently on hand. The site is zoned as industrial reflecting its early days when Wells Avenue was a magnet for light manufacturing or R&D functions. More recently, the park has become a darling of corporate and office tenants seeking first-class space at a discount to record rents in downtown Boston and Cambridge and Route 128 Central.
“The area has become very popular,” concurs Freid, one near-term example of the submarket’s growth being Bright Horizons Day Care leasing 100,000 sf for its new headquarters. There was also the highly publicized relocation of TripAdvisors to a new build-to-suit in the N2 District. And while Newton turned its back on a multifamily redevelopment for 135 Wells Ave., 128 CRE highlights several existing residential options in the nearby Newton Highlands and exclusive ‘W’ suburbs that are a quick jaunt up Routes 9 and 128.
The demographics compiled by 128 CRE show a residential population in a five-mile radius whose annual household income for the constituency cresting 350,000 whose average age is 38.2 years. The 6,350 residents in a one-mile radius are a bit longer in the tooth at 43.6 years but boast a household income metric of $232,941. Those residents and the 185,000 people employed at nearly 15,000 businesses within five miles of 135 Wells Ave. are supported by a wealth of amenities, notes 128 CRE, including dining, entertainment, hotels and retail. Newton also has a rare suburban perk in public transit centered around direct MBTA Green Line access to downtown Boston and Cambridge with commuter rail connections.
The unusual presence of 135 Wells Ave. to the master-planned Wells Avenue Office Park has been an enduring legacy dating back to its days as an indoor tennis center aided by a linear constitution and two-story construction providing clear heights above 30 feet. Prior to G&Z acquiring 135 Wells Ave., the asset brought $16.3 million in June 2014 from the group which proposed the ill-fated residential play. Before that, the building traded for $9.0 million in February 2003 and for just $3.2 million in Dec. 1993.
Fast forward to 2019 and Freid expresses confidence 135 Wells Ave. possesses continued cachet. “It is a special property that we are very excited to be (representing),” he says in adding anyone interested can review the offering by going to 128cre.com and accessing the “Properties” section.Jordan B. Sneider Adam T. Meixner Douglas T. Adamian Jeremy A. Freid Tyler J. Capecci Meghan Huebner