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29
March 2017
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The Seaport - A new Era in Boston Luxury Real Estate | By Alice Markson

Boston’s Seaport, formerly known as the South Boston waterfront, was long seen as a sparsely populated urban wasteland. Parking lots and functionally obsolete wharfs and warehouses stretching from Congress Street in the Fort Point Channel to the Marine Industrial Park littered the landscape. Home primarily to the nefarious activity of Whitey Bulger and friends during the 1980’s, this city shoreline required more than a little strategic vision to be reimagined as an integral piece of the urban core. Today, innovation thrives under the umbrella of a 1,000 acre master planned neighborhood known broadly as The Seaport.

In the 1970’s and 1980’s, a few of the original “waterfront” warehouses were converted to loft-style condos comprised of exposed brick and industrial character familiar to the area. During that time, the area was still very much cut-off from the Financial District by the old Central Artery overpass. The opening of the Ted Williams Tunnel in 1995, completion of the Big Dig in 2007, and the expansion of the Massachusetts Bay Transit Authority’s Silver Line to the Seaport in 2004 brought the once isolated Seaport in sync with the Financial District and Downtown areas.

In the early ‘00’s, redevelopment of the Seaport began in earnest. In more recent years the Seaport has welcomed 10 million square feet of development. To date, there are seven luxury condo buildings in the Seaport : 21 Wormwood Lofts (166 condos, 2000), 25 & 35 Channel Center (76 condos, 2004), FP3 Lofts (92 condos, 2009), Twenty Two Liberty (108 condos, 2016), 319 A Street (48 condos, 2016), and Dockside Place Lofts (88 condos, renovated 1982). Three additional condo buildings including 10 Farnsworth, a boutique luxury 9-unit condo building, Pier 4, a 100-unit luxury tower and 50 Liberty, a 120 unit tower, are all scheduled to be completed by 2018.

Early residential investors in the Seaport are in position to reap outsized returns. Currently, the average asking price per square foot, for properties north of $1M, is $1,625 while ultra luxe units are commanding over $2,500/SF.

The Seaport housing market has tripled in size from 2013 to 2016. As of March 27, 2017 there are 13 total listings (two sub $1M and 9 between $1.2M - $9.1M) on the market with an additional 5 listings (ranging from $550K to $5.5M) at the InterContinental. MLS (Multiple Listing Service) does not include the InterContinental (500 Atlantic Avenue) as part of the Seaport, but we would suggest Intercon residents may associate more freely with Fort Point Channel than the North End waterfront area where they are presently tracked.

With buyers’ appetite for a Seaport address on the rise, developers of two colossal mixed use projects should be met with enthusiastic demand upon completion.

Fan Pier is a development that covers 21 acres of harbor front property to the north of Northern Avenue. The 3 million square feet of commercial and residential real estate is home to the ICA and new luxury towers at 22 Liberty and 50 Liberty (expected in 2018), along with a collection of businesses who could not resist the harbor and city views.

Seaport Square, a development site across Northern Avenue from Fan Pier, boasts 23 acres of land and 20 city blocks that will showcase apartments, condominiums, office space, hotels, a chapel, retail, cinema and a performing arts center. This new neighborhood sprawling across 6.3 million square feet, is home to Boston’s Innovation District and will connect Fort Point, Fan Pier, Pier 4, and Waterside Place.

The Innovation District, more frequently referred to by its alias, the Seaport, is now more than 10 years in the making. In 2005, developer Joe Fallon gained control of 21 prime waterfront acres (Fan Pier). With strong support in the form of real estate tax incentives from the late Mayor Tom Menino, Fallon developed his property in the spirit of "Live, Work, Play," blending commercial, residential and retail together seamlessly. The concept was to create a densely populated area where innovators could work in close proximity to increase shared knowledge.

This vision for an innovation district is rapidly coming to fruition. Currently, 120 companies including smaller startups and big names like JP Morgan, Mass Challenge, and Goodwin Proctor call the Seaport home.

General Electric is scheduled to open their world headquarters in Fort Point Channel by the end of 2019. GE was lured in part by generous subsidies offered by the city and state, but more so due to the region’s massive pool of workforce talent stemming from both the colleges and universities and Boston’s existing technology sector. The 800 employees joining GE and/or relocating could be in time for the deliveries of the forthcoming Seaport addresses, if they decide to reside blocks from the office.

Reebok was the latest company to announce a move of their headquarters to the Innovation District. By the fall of 2017, their 700 employees will occupy 220,000 square feet and five floors of space at the Innovation & Design Building.

Past census growth reflects a slow shift to the Seaport, but with all the recent and planned developments the 2020 census will show a dramatic surge in the number of residents calling the Seaport home.

While several new and modern condos have risen from the ground and companies have flocked to the area, the requisite services and infrastructure, such as large supermarkets, pharmacies and street level retail have not opened at the same pace. Both the Fan Pier and Seaport Square developments offer large scale retail opportunities and it stands to reason that these voids will be satisfied in the coming years. A plethora of high-end restaurants have arrived in the Seaport making it a destination both for suburbanites and city dwellers in need of a night on the town. A CVS also opened along Seaport Boulevard in the fall of 2016 foreshadowing more retail to come.

The Seaport’s rising prominence in the landscape of Boston neighborhoods has been tough to miss. Ten years of steady growth and development have created a dynamic new environment within the city. As the next phase of development in the Seaport takes hold, the area promises to attract more employers, jobs, shops and residents. We aim to be a continued source of research and data for our clients who hope to get a foothold in the area. Don’t hesitate to ping us if we can help you understand it.