BOSTON — Avison Young has successfully repositioned and recapitalized three large commercial properties comprising 540,000 square feet, located in the greater Boston market. The institutional-grade assets, 299-301 Ballardvale St. in Wilmington/Andover, Mass., and 201-207 South St. (pictured at right) and 52-56 Roland St. in Boston (pictured on main page), were acquired between 2006 and 2007 and underwent capital improvement upgrades to reposition the properties during the initial phase of ownership. Each of the properties recently has benefited from a recovering market, new leasing activity and proactive management.
“In the last 12 months we have executed new leases on more than 180,000 square feet, or approximately one-third, of the portfolio,” said John Fenton, Avison Young principal and managing director of the company's New England region. “In conjunction with the new leasing, each asset was recapitalized to provide a more competitive financial position in the marketplace.”
The restructuring included new leasing activity, an infusion of fresh equity and term modifications on more than $50 million of first-mortgage loans to extend maturities and provide additional capital to fund the cost of new leasing.The portfolio benefited from an uptick in leasing activity in general, particularly in the high-tech, manufacturing and biotech sectors.
Avison Young, on behalf of the various property owners, negotiated the pricing and managed the construction of tenant improvements associated with more than a dozen new leases, including lease extensions at each of the properties. The new transactions are a mixture of relocations and expansions in Downtown Boston and in the suburbs.
A few highlights from the properties include:
299-301 Ballardvale
- AEB (34,240 square feet)
- GE Healthcare (23,200 square feet)
- AEI (15,400 square feet)
- Protopac (15,400 square feet)
201-207 South Street
- Michael Dennis Architects
- Boundless Learning
- Credo Reference
52 Roland Street
- SEIU 888 (10,000 square feet)
Resulting directly from the financial reorganization, Avison Young was able to compete for new tenant requirements in the market, which in turn stabilized property operations, noted Beth O'Donnell, Avison Young's director of client services in Boston.
“Due to the value-oriented acquisition pricing and hands-on management, these assets weathered the economic storm in 2008 and 2009,” added Fenton. “Avison Young worked closely with its key stakeholders — the investors, the lenders and the tenants — to manage the best possible outcome for all parties.”
In addition to leasing and management, the company performs third-party construction management, and in connection with the leasing activity above, Avison Young also managed the design, negotiation and construction of approximately $3 million of tenant improvements to support the leasing activity.
“We have the in-house capability to execute complex construction assignments from beginning to end for tenants in our portfolio,” said Brian Hodess, Avison Young's director of construction services for Boston. “Many of these deals took a long time to come together, but we delivered simultaneous projects on time and on budget.”
Avison Young opened its Boston office in fall 2010 and continues to expand its New England presence. Earlier this month, a group of brokers led by Jack Kerrigan and Steve Cook joined Avison Young to expand its service platform in the New England market. The company's goal is to staff the office with 10 to 20 top-tier real estate professionals and expand property management and asset management services by year-end 2011.
— Dan Marcec