The longtime home of legendary Boston seafood restaurant Anthony’s Pier 4 is rapidly transforming into a luxury condominium complex, and the site’s developer just landed a lease with farm-to-table restaurateur Kristin Canty.
Interest is strong for the Pier 4 condos, said Janice Dumont, CEO of AdvisorsLiving. The firm, which is the residential division of Boston Realty Advisors, is the exclusive sales and marketing agent of the nine-story, 106-unit complex.
Pier 4, a nine story, 106-unit luxury condominium building, will open in late 2018 at the former Anthony’s Pier 4 site in Boston. Tishman Speyer is developing the complex, which was designed by SHoP Architects in collaboration with Boston-based CBT.
“Given the nostalgia of the site, and the fact that so many people have had wedding receptions, bar mitzvahs, confirmations, at the site, it’s been very exciting,” Dumont said in an interview with the Business Journal.
Two-bedroom units at Pier 4 will start at $2 million-plus. Each home has its own private outdoor space and water views, and penthouse units will feature private roof decks. Amenities include an outdoor terrace, an outdoor seating and dining area with a fire pit, virtual golf and 24-hour concierge services from First Service Residential.
The nationwide trend of real estate agencies mergers and acquisitions came to Boston this month with Douglas Elliman’s announced purchase of local Otis & Ahearn Real Estate. Smaller firms are feeling the pinch from rising costs and market forces, and more consolidations are likely.
The increased attention from out-of-town players has been a major topic of conversation around the watercooler at Boston Realty Advisors, said Jason Weissman, founder and senior partner – and he couldn’t be happier about it.
“It shows the strength of the market,” he said. “You have to look at Boston. If we end up going into a recession, Boston is going to have the softest landing of any city in the country because of the diversity of strong industries we have here. This city is going to outpace other cities.”
Boston Realty Advisors in the largest independent brokerage in the city as measured by gross commission income, Weissman said, and he has also been approached by other companies looking to acquire it. He’s not interested. In fact, he’s actively looking for companies to acquire.
“There’s no exit plan,” he said. “We’re very focused on serving our clients. They say if you love what you do, you’ll never work a day in your life and I love the business. I love competing and I love competing successfully. It’s extremely tough for smaller independents to compete. We’ve built the infrastructure to compete and win.”
Think Globally, Sell Locally
Gibson Sothebys is also in acquisition mode. Co-owner and chairman Larry Rideout said his company is not looking to be acquired, but he does see more acquisitions in Boston’s future.
“Big, New York companies are starting to see that Boston is on the map,” he said. “We’re also in acquisition mode. Now is a good time to consolidate in the Boston market. We’re looking for a cultural fit. Of course, the numbers have to work out and it has to be a win-win.”
Rideout said the white-hot Greater Boston real estate market can’t burn forever, but he thinks the signs point toward a few more good years. Companies that make smart acquisitions now will cash in on those good years.
“Permits are down, but they were up for a long time and things have to take a breath,” Rideout said. “Sales slowed a little this summer, but they’re going to come back. You have to look long term. Mortgage interest rates are low, money is cheap and Wall Street is doing OK.”
As Boston has become a more international city, Rideout said having the money and the network to market globally has become vital. Small, local companies just don’t have the same reach, making it harder for them to compete.
“You have to start thinking globally,” he said. “I have Sothebys, with an amazing international reach, and I still joined ‘Who’s Who in Luxury Real Estate.’ You have to use everything you can.”
Boutique Firms Can Compete With Behemoths
There’s still plenty of business for small, locally owned real estate agencies with excellent customer service, said Carmela Laurella, president of CL Properties. Laurella isn’t concerned with acquisition talk; she’s focused on remaining small and providing “excellent service and exceptional results.”
“Our firm is eight years old and we’re having one of our best years ever,” she said. “We operate like an investment banking firm. We choose to stay small and boutique. Most of our business comes from the Internet and repeat business. We have no problem getting listings and making sales.”
Deep pockets and a global reach are not as important as growing a local base of satisfied customers, she said. Big firms like Douglas Elliman and Berkshire Hathaway, who are both in acquisition mode, don’t bring that to the table.
“I wish them both well, but I do think they’ll have a hard time catching up,” she said. “This business is about people and relationships. I used to work for Coldwell Banker and Otis & Ahearn and when I left, my clients followed me, the agent, not the brand. We’re niche players. I have people who will walk over the Charlestown bridge to find me because they want me to sell their homes.”
Douglas Elliman did not respond to requests for comment.
Change Creates Opportunity
The trend of smaller companies being consumed by larger ones will continue in Boston, said Jeff Heighton, regional vice president and Boston-area general manager at Compass Real Estate. The Greater Boston economy is growing quickly and big companies are looking to capitalize on that.
“Boston is a major metropolitan area with a lot of investments from across the country and globe,” Heighton said. “If you’re a large company, you need to make sure you’re in the major markets across the country, like Boston. For companies that aren’t here, they’re thinking about it.”
Growing a business by acquisition is far more complex than simply buying an agency and changing the flag, he said.
“I’d say we’ll see more acquisitions in the near future at all levels as agents ask their firm, ‘What are you doing to grow my business?” Heighton said. “As that question can’t be answered, they’re going to look for companies that can. That’s part of what’s driving the consolidations.
Welcome to Boston, tech wizard/financial planner/GE executive! Your new apartment has elegant fixtures, stainless appliances, underground parking, a fireplace, and a view of the harbor in a gleaming new building.
But that name, though.
All over Greater Boston, luxurious new living quarters are sprouting up like gleaming, modernist weeds. And a lot of them, for reasons that aren’t entirely clear, have names. Not names like the apartment building you may have grown up in — “23 Stanley Street” — but Names. The Eddy. VIA. TROY. The Kensington. Watermark. Alloy. The Allele.
Allele is, of course, Adele’s less talented younger sister (you may have heard her hit song: “Hello. It’s me . . . Allele”). No, that’s not right. Since most Americans are fluent in the chromosomal genetic science, we obviously know that an allele is (Googles frantically) a different version of a gene.
Somewhere along the way, we started naming our cats like people and our people like cats. “Meet my son, Plank, and my cat, Bruce.” Now we’re naming our apartment buildings like swanky hotels. Pretty soon hotels won’t even have names, just a picture of a buffalo that looks like a caveman drew it.
“It gives them a little panache,” said Mary Kelleher, a real estate agent with Gibson Sotheby’s International in Boston. “You can say to me ‘150 Dorchester Avenue,’ and you’re like ‘Where the hell is that?’ ”
And because the marketing of high-end apartments and condos sometimes hinges on a little panache, the names race is on.
“We’ve named quite a number of projects,” said Javier Cortes, partner and creative director of KORN Design, a brand strategy and design firm in Boston. “The process involves a fair amount of research — we try to honor the place and its history.”
Remember the “Mad Men” episode where Don Draper sells a slide projector with a speech so thoughtful and impassioned that it sent an ad executive scurrying away in tears? It’s sort of like that, but for high-rises. Cortes and his team whittle down a list of maybe a hundred names to about a dozen that they bring to their clients.
“You want to make sure the name is memorable, applicable, not too hard to pronounce,” Cortes said, and then you have to scan for “egregious meanings in other cultures” — the classic (and largely apocryphal) Chevy Nova problem, in which Spanish-speaking countries allegedly declined to buy a car named “doesn’t go.”
KORN named the Liberty Hotel — it seems obvious now, but when it was an abandoned, rat-infested jail next to the hospital, it didn’t scream “luxury hotel” or “liberty.” Alloy, at Assembly Row in Somerville, was so named because it represents the “fusion” of Boston and Somerville, Cortes said, and echoes the area’s industrial history.
The Eddy, he said, emerged from historical research and calls on three different ideas. Eddy, most simply, sounds a little like Eastie, the neighborhood where the building sits on the water. Robert Henry Eddy, an architect and civil engineer, worked on various early maps of East Boston in the 19th century. And “eddy” describes circular movement in water running counter to the main current.
“If you’re deciding where you’re going to live in Boston, choosing to live in Eastie is a little counter current,” Cortes said. “Here’s a building that’s on the water and runs counter current.”
“It’s OK if you don’t know it on face value. It sounds cool and it works,” Cortes said. “We work hard to make sure there’s very deep meaning.”
But they can’t all be this deep. Right?
Lars Unhjem, vice president of development in Boston for Mill Creek Residential, said Modera Medford earned its name because “Modera” is Mill Creek’s flagship brand nationally (the Medford part is self explanatory).
“No meaning,” Unhjem said in an e-mail, “just a word someone made up.”
“Some of it, honestly?” Kelleher confided, “we pull this stuff out of you-know-where.”
This all started happening in earnest during an earlier building boom, said Colleen Barry, chief executive officer of Gibson Sotheby’s International Realty.
“The units were getting scooped up. We weren’t really worried, per se, about whether they were going to sell,” Barry said. “What we were starting to think about was how do you distinguish one from another? The idea was to brand these so they each kind of had a different feeling.”
“It was the very early stages of a slightly different way of thinking about development,” Barry said.
As it happens, Kelleher credits Barry with naming The Allele.
The Allele’s name, Kelleher said, grew from a discussion about the building’s concept: All the best elements of loft living (high ceilings, open floor plans) without the drawbacks (sleeping in what is essentially the far corner of the kitchen; commune-level privacy).
“I think ‘allele’ is a biological term — the fusion of two elements,” Kelleher said. “I’m probably simplifying it. Maybe even bastardizing it.”
But not according to one of the world’s leading geneticists. Dr. Stephen Elledge is the Gregor Mendel Professor of Genetics at Brigham and Women’s Hospital and Harvard Medical School. He’s also a 2017 recipient of the Breakthrough Prize, which “recognizes paradigm-shifting discoveries in the life sciences, physics, and mathematics,” according to the Harvard Gazette. The board is a who’s who of tech billionaires, and the prize comes with $3 million.
In an e-mail that was surely a profound waste of his very valuable time, Dr. Elledge said collections of alleles account for differences between people — height, eye color, etc. Many of those differences aren’t inherently good or bad.
“I am ok with ‘Allele,’ ” Elledge wrote, emphasizing that the variation they’re referencing isn’t bad — just different. “In this case, I suspect they feel like their change is one for better.”
The Boston Upscale and Luxury Condo Market had a Strong 2016.
Sales volume in the Boston Upscale and Luxury condo market in 2016 was up 7% with the average price up 20% to $1,150,000. An unseasonably high fourth quarter 2015 can be attributed to the closing of 22 Liberty, while the third and fourth quarters 2016 benefited from the closing of Millennium Tower. Overall, when comparing fourth quarter 2015 and 2016 absolute prices remained fairly flat, with fewer transactions happening in 2016 because a majority of the Millennium Tower sales happened in third quarter versus fourth quarter 2016. We define the Upscale market as condos $700/SF+, $500,000+, 4+ units, and central AC in the building, while Luxury is the top 10% of the market. Even though the average price per square foot may be 6% below the end of last year average PPSF, it is still 5% higher than the next highest quarter. As condo prices continue to go up, many buildings that did not qualify as “Upscale” in 2015 do now, as they are now trading higher than $700/SF and $500,000, further showing that pricing along all residential segments is up.
Neighborhood Supply Low and Demand High. When observing all Boston markets, there is still a shortage of supply in all neighborhoods. Market equilibrium is typically defined as 6 months of available inventory. Very few large residential projects are delivering in 2017, but those that are, are 40%+ sold out. The two largest buildings delivering in 2017, Pierce (The Fenway) and 50 Liberty (Seaport), are both 40-50% sold out as of the end of 2016. A few other projects slated to be delivered this year are Siena (South End), 110 Broad (Financial District) and Telford 180 (Brighton) are also selling fast. Sales offices for LoveJoy Wharf (Waterfront, near North Station) with plans to capture some of the pent up demand in the “Upscale” market for homes located on the water but with no parking in the building offered. Back Bay continues to go strong with One Dalton condos selling at record high selling prices with a new high watermark on price per square foot as well.
What’s Hot? By the end of 2016, the main three condo types (1, 2 and 3 bedrooms) in the upscale and luxury markets all saw big jumps in asking prices. Both one and two bedroom condos saw the largest jump at approximately a $100,000 increase to average asking prices, bringing them up to $1.1 million and $1.9 million, respectively. Three bedrooms saw the largest sales to ask spread of three condo types, but still achieved an average sales price over $3 million.
Overall, 2017 looks to be an exciting year in the Boston real estate market, with prices only expected to continue to rise in a supply constrained market.
What does The Federal Reserve Increase on Wednesday, December 14 mean for you?
On Wednesday, December 14th, the Federal Reserve raised the federal funds rate by 25 basis points from 0.5% to 0.75%. The confidence in the U.S. economy was caused by a strengthening labor market, a low rate of unemployment only expected to go further down in 2017, and inflation moving rapidly toward targeted levels. This is only the second time in the past decade that this has happened. It is anticipated by the Fed that there will be three rate hikes in 2017 instead of two, a change that reflects their increased anticipation of a strong U.S. market.
According to Fed Chairman Janet Yellen, “Our decision to raise rates should certainly be understood as a reflection of the confidence we have in the progress the economy has made and that it is expected to make.”
So what does this mean for potential home-buyers in Massachusetts, or really throughout the U.S.?
Now is the time to buy. Mortgage interest rates are still very low, but with this announcement and other increases predicted for 2017, your buying power as a consumer of real estate is only going to go down as the Mortgage rate goes up.
For example, the cost to finance $500,000 (before this announcement, 30-year fixed, 4.35%) was approximately $2,486 per month principle and interest. Since the rate increase on Wed. the average % has moved to 4.45% giving a buyer a cost of approximately $2,519 per month principle and interest. An increase of approximately $33 per month or $396 per year. With three more interest rate increases expected in 2017, one can expect these small bumps in the mortgages rates to add up to a bigger monthly cost number. If you can, buying now make “cents”.
Advisors Living is pleased to introduce our newest exclusive listing. This luxury new construction contemporary single family home is located at 175 K Street in South Boston. Designed by the local and talented architectural firm Embarc Studio, this home was built to offer a multi-level contemporary and luxurious lifestyle while maintaining the much sought after and often over looked traditional layout. The transitional finishes embody a pronounced elegance and sophisticated design, culminated by an exceptional use of material and craftsmanship.
THE SUBSTANTIAL FOUR BEDROOM HOME is remarkable in nature with its open concept and impeccable custom design. The abundant oversized Marvin integrity windows and the 10’ ceiling heights throughout offer a natural rhythm shared with the exterior, a design that prioritizes quality of light and use of space.
THE PROFESSIONAL CHEF’S KITCHEN features Jenn-Air stainless steel appliances. The custom painted light grey, beaded edged maple cabinets are accented by the Quartz Artic white honed counters which present clean and modern lines.
The build and layout exceeds by including a wonderful living room accented by a centered modern gas fireplace and a well-positioned separate dining area that fills with natural light via exceptional window placement.
Advisors Living recently completed the sell out of 42 market-rate condominiums at the Mosaic on the Riverway. Closing prices averaged nearly $1,000 per square foot. Below is an excerpt from Curbed Boston’s coverage on the new development success:
In October 2015, sales at Mission Hill’s under-construction Mosaic on the Riverway residential complex got underway. Some 85 of the 10-story building’s 145 units were slated as condos, with 42 of them market-rate and the rest below-market-rate (the remaining 60 units are designated as affordable rentals).
All 85 Mosaic condos have traded and closings have started.
As of Oct. 5, 11 condos have closed at an average price of $928 per square foot, according to Bldup.com. That is a not-insignificant sum for the neighborhood, but not all that high by new-development standards in present-day Boston.