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Tue, Jan 26
A Compendium of Property & Capital News
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Jan 26
A Compendium of Property & Capital News

Horvath & Tremblay Land $7.25M Ground Lease Listing for JP Morgan Chase Bank in Premium N Quincy

December 07, 2020 - By Mike Hoban
Rendering: Chase Bank, North Quincy

QUINCY–Further evidence of the resurgence in the Quincy commercial real estate market comes via the recent announcement that the ground lease for a still-under-construction JPMorgan Chase Bank retail location is expected to draw considerable attention from a broad range of institutional and private investors.

Interest in the property, listed for $7.25 million by Horvath & Tremblay, is buoyed not only by the strong credit of one of the highest-rated retail tenants in the net lease market but its prime location at 315 Hancock St. Situated on a corner parcel of the Red Line’s North Quincy MBTA Station entrance, at the signalized intersection of Hancock and W. Squantum Street – with a traffic count of over 30,000 vehicles per day – the bank branch will be located in the heart of the new mixed-use development, The Abby.

The development (named after former first lady Abigail Adams of Quincy) connects to the MBTA station and will be comprised of 600 apartments, 45,000 square feet of retail space, and 1,600 parking spaces - half of which will be set aside for MBTA commuters. The project is a joint venture between the Washington, D.C.-based apartment developer Bozzuto Group and Atlantic Development of Hingham.

“From a location and credit standpoint, this property is one of the top net lease properties available in the U.S. right now,” opines Horvath & Tremblay founding principal Robert Horvath. “You have (rent) escalations, great credit, and great location. The site has everything going for it.”

Chase Bank signed a 15-year ground lease with six 5-year renewal options, with the lease calling for 10% rental increases every five years through the current term and all six option periods, which provides investors an attractive increase in revenue and a hedge against inflation, Horvath notes. The lease is an absolute triple-net, with the tenant responsible for all operating expenses, repairs, maintenance, and replacements to the entire property (including building and grounds).

“I don’t know where the buyers will ultimately come from, but it could be private clients that are long cash, 1031 exchange buyers looking to deploy capital, some private-public funds, or perhaps some foreign buyers,” says Horvath. “We may also see some big family offices that may just want to diversify and buy into some good real estate.”

In 2018, JPMorgan Chase announced its intention to expand its branch network into new U.S. markets, opening up to 400 new branches over the next five years. One of those markets was Boston,(see story here) where they announced plans to open 50 retail branches in the Greater Boston metro region over the next several years. The strategy appears to be working, as the bank grew its deposits from $178.7 million in 2019 to $657.1 million in 2020 (through October 1).

“It’s going to be a great site for Chase as they continue to expand in the Northeast because Quincy is absolutely booming,” predicts Horvath.

Bob Horvath