NAI/Hunneman Team Peddling Hub Apartment Asset for $1.8M

BOSTON — A debtor-in-possession scenario has 484 Commercial St. being positioned for sale here in the city’s North End district. The five-story, five-unit apartment building is priced at $1.8 million, according to NAI Hunneman Commercial Co. principal Robert Tito, whose firm has been hired to pitch the 5,900-sf asset through its seasoned investment sales group. The campaign is being led by Tito and colleague Dan McGee.

Tito cites upside potential on existing rents, the option of condominium conversion and even adding another floor as among the chief attractions that he predicts will generate a bevy of prospects. One calculation shows current rents could be boosted to increase monthly income from $9,850 to $10,750,
while there is also the opportunity to split up a penthouse unit that is actually two conjoined apartments. The analysis anticipates net operating income from 484 Commercial St. could jump another $10,000 annually to nearly $100,000 by following such strategies.

Trends would appear to be in favor of higher returns for multifamily landlords, according to industry watchers who cite tepid home sales for boosting apartment demand in Greater Boston. Meanwhile, delivery of new units has been stunted by the US recession. “It’s a very strong market today,”says Tito.

In divesting 484 Commercial St., the bankruptcy court has established a precise timeline as a debtor-in-possession situation, says Tito. Tours will be available in the coming weeks, followed by an announcement of a call for offers. “We’re getting great activity right out of the box,” Tito says, predicting many of those visiting the asset will turn into fervent bidders. Units benefit from “great sunlight” and have water views, Tito relays, while a few are in sight of the USS Constitution across Boston Harbor at the Charlestown Navy Yard. “Plus its an apartment building in the North End,” Tito says. “How can you go wrong?”

NAI/Hunneman is active throughout Greater Boston in multifamily brokerage. This spring, Tito, McGee and Gina Barrosso negotiated the $5.2 million sale of 227 Park Dr. near Fenway Park, yielding in excess of $250,000 per key for the 21- unit property. Tito says he is hopeful of increased listings in 2011 as owners respond to heightened investor demand in an improving economy.