Thibeault Tabs Colliers to Trade Two Hub Assets; 54,450-SF Package Could Bring $19MOctober 20, 2017 — By Joe Clements
BOSTON— Prescient regional investor Thibeault Development is putting another commercial assemblage here up for sale, and that is good news for Colliers International whose Capital Markets team has already completed two other Hub trades this year for the Everett-based firm which is led by founder William Thibeault and the brokerage shop is marketing two more properties including the landmark Liberty Tree Building at 630 Washington St.
Market watchers maintain conditions have improved so rapidly that bidding for the latest exclusive involving 13-15 and 19-21 Congress St. could approach$19 million barely a year after Thibeault acquired them for $14.5 million.
The other buildings Colliers already harvested for that client this year yielded $38.5 million when they changed hands in March to another local investor, those holdings 103 Arch St. and 153 Milk St.
The Congress Street assignment involves abutting mixed-use buildings enjoying their own block in what Colliers declares an “ultra core location” one door removed from Congress and State Streets, epicenter of a resurgent Financial District. “ It is right in the middle of all that is going on downtown,” says Colliers Senior VP Christopher J. Sower, his multifamily practice crew taking the charge thanks to permitting in-place for 36 apartments and retail, a plan secured prior to Thibeault acquiring the buildings in early August 2016 that includes a 7,000-sf expansion.
Thibeault bought the properties totaling 54,450 sf from Related Cos., that firm having purchased them in December 2013 from Fidelity Investments as part of a seven-building portfolio where the financial services giant had been headquartered for decades. Related pared off two other buildings to a separate investor last summer for $16 million, helping defray its investment.
The remainder is forging into a 370,000-sf office building and 165-room Hyatt Centric Hotel, both slated to open next year, and Colliers reports 13-21 Congress St. will also benefit from Related’ s restoration of Quaker Lane, a small side street weaving peripateticly between the buildings, with the plan calling for cafes, extensive greenery and landscaping plus outdoor seating set against a new lobby entrance to the Thibeault structures.
While he declined to discuss pricing estimates, Colliers is not restricting the marketing effort to the residential sector, Sower explains, instead letting bidders determine the future of the assets. Class B office space has become all the rage since Related envisioned the six- and 11-story structures as housing and ground-floor retail, and so Colliers Capital Market principals Scott Dragos and Douglas Jacoby have their five-member team on the case as well.
“ It is wide open,” Sower relays of the asset being delivered vacant and in shell condition. “ This is clearly a fantastic location for multi-family, but people might have other ideas for what should go there, and we and to make sure they have an opportunity to (compete) for it, ” conveys Sower. Other members of the multifamily contingent are Assistant VP Jen Price, Associate Jonathan Bryant and Client Services Coordinator Maggie Collins. Assistant VPs Anthony Hayes and Timothy Mulhall join Associate Dan Hines to comprise the Dragos/Jacoby operation. Leasing brokers Dan Collins and Lauren Vecchione are available to dissect evolving office rental conditions.
Similarly sized structures to 13-21 Congress St. have been repurposed for a variety of functions from hotels and multi-level retail to medical office and traditional corporate space, and the latter use has come into vogue this decade as startups and technology firms eschew the high-rise experience in favor of the city’ s geriatric legion of boutique and mid-rise buildings many had deemed obsolete at the turn of this decade when the Class B vacancy rate was approaching 20 percent while rents were plummeting.
No more, with Colliers putting Class B rents at $42 per sf, a 50 percent increase since the office market cratered in 2011. Class A product growth was 30 percent in that time period, and even though those rates remain higher, the delta has never been smaller in the downtown arena, Colliers research indicates.
Were a buyer to retain the approved plan and not require changes, Sower notes work could commence upon closing on the asset which is being delivered free and clear of any debt. Colliers has its structured finance group led by Kevin Phelan and Jeff Black advising suitors on debt solutions. Apartment developers, condominium converters and even firms providing short-term corporate rentals are among the parties Sower predicts will consider the assets whose rollout continues a busy season for apartment sales activity in metropolitan Boston. “ We are very excited about this listing, ” the multifamily expert says. “ The timing is right to test the market, and we expect a lot of interest.”Jonathan Bryant Jennifer Price Christopher Sower Maggie Collins Lauren Vechione