In January 2010, as New England was beginning to emerge from the Great Recession, Thomas Menino, then mayor of Boston, launched an initiative dubbed “the Boston Waterfront Innovation District.” The plan was to take approximately 1,000 acres (400 ha) of underdeveloped land on South Boston’s waterfront and create a “work/live/play” environment designed to attract and foster innovation within the city’s technology community.
Situated on the Boston Harbor, the mile-plus-long (1.6 km) district was close to Logan International Airport, with access to Interstate 93 and the Massachusetts Turnpike and convenient to public transportation, making it an ideal location for redevelopment. Composed of windswept parking lots, rotting piers, and underused warehouses, the site also offered potential research and development (R&D) inventory in the Marine Industrial Park as well as inexpensive Class B brick-and-beam office space in the Fort Point Channel section that would appeal to startups in the technology, advertising, media, and information (TAMI) sectors.
While not all of the stated aims came to fruition, Menino’s initiative created the impetus for what is now known as the Seaport District. And less than a decade later, the new neighborhood is emerging as a preferred destination for commercial and residential tenants. A huge influx of startup and established companies (including GE, PwC, and Reebok) have relocated to the Seaport, and apartment rentals and condominium sales are achieving pricing levels never seen in Boston.
“I think the Seaport has the potential of becoming the best neighborhood in all of Boston,” says Vivien Li, former president of the Boston Harbor Association. For 24 years, Li spearheaded successful efforts to clean up the harbor and preserve public access, yielding the acclaimed 43-mile (69 km) HarborWalk, a near-continuous linear park that connects Boston’s waterfront neighborhoods from Dorchester to East Boston that is the envy of coastal cities across the country. And while Li joins other observers who would like to see more affordable housing, she says that “the Seaport is the Boston of the 21st century—the types of retail, the open space, the range of businesses, and the cultural institutions—there isn’t another part of the city that’s as vibrant as this.”
It is also a neighborhood that is far from complete, with hard hats, cranes, and structural steel visible on nearly every block. Visitors returning after even a brief hiatus may be taken aback at the wholesale changes to the Seaport skyline, particularly in Seaport Square, the 23-acre (9.3 ha) site that has been approved for 7.6 million square feet (706,000 sq m) of residential, hotel, office, retail, entertainment, civic, and cultural uses, as well as public open spaces.
The site was acquired and master-planned by Morgan Stanley and Gale International (now Boston Global Investors) in 2006, and Boston-based retailer WS Development joined the partnership in 2007. In 2015, WS acquired the project’s remaining 13 acres (5.3 ha) of development sites and assumed the role of lead developer, undertaking a complete redesign of the master plan.
“We try always to remember that this is not a development project; this is the creation of a neighborhood,” says Yanni Tsipis, senior vice president of Seaport development at WS Development.
“This is a piece of a great American city, and great cities are composed of great streets, public places, and social spaces that happen to have buildings built between them. That is a very important philosophy for us as the stewards of the Seaport.”
Tsipis says that much of the focus for WS has been on the public realm—streets, sidewalks, and parks—within the 33-acre (13.4 ha) district, which means altering the streetscape from its turn-of-the-21st-century urban design, which paid little heed to pedestrian comfort or bicycle safety. WS hired James Corner Field Operations (which designed the High Line in New York City) as its master plan landscape architect, and they have begun work on projects such as the Harbor Way, a tree-lined open space that runs one-third of a mile (0.5 ha) from Summer Street (home of the convention center) to the waterfront and includes Harbor Square Park, a 1.5-acre (0.6 ha) park that will provide what Tsipis refers to as “a public green oasis amidst one of Boston’s densest neighborhoods.”
Across from Harbor Square Park, WS and partner PSP Investments will construct a 525,000-square-foot (49,000 sq m) mixed-use building for Amazon, which will bring 2,000 employees to occupy all of the office space in 2021. In addition to 4.5 million square feet (418,000 sq m) of development rights, WS owns and operates the retail portion of all the buildings in Seaport Square, including One Seaport, where traditional retail offerings are augmented by a bowling alley/nightclub, a movie theater, and restaurants on three floors beneath a pair of luxury apartment towers—the Benjamin and the Via—which contain 832 units in total.
But development has not been limited to Seaport Square, and new construction and redevelopment projects throughout the Seaport continue to break ground at a dizzying pace. In December 2017, homegrown Related Beal began construction on the first phase of Innovation Square (iSQ), a 375,000-square-foot (35,000 sq m) R&D life science campus in the marine park at the Seaport’s farthest reaches. In May, New Boston Hospitality, Omni Hotels & Resorts, and the Davis Companies broke ground on the 1,054-room Omni Hotel, located on a two-acre (0.8 ha) parcel across from the Boston Convention & Exhibition Center.
“That’s a game-changer,” Colliers International Boston director of research Aaron Jodka says of the hotel, which opens in 2021. “Because one of the knocks on Boston has been that the city lacks a true convention center hotel, it will be transformative.”
Although development has exploded over the last five years, the creation of the Seaport has been decades in the making. In 1986, the Drew Company, led by namesake John Drew, and Fidelity Investments created the Seaport World Trade Center Boston, comprising 600,000 square feet (56,000 sq m) of office space and 250,000 square feet (23,000 sq m) of convention and meeting space. The 428-key Seaport Boston Hotel and an additional 1 million square feet (93,000 sq m) of office space were added around the turn of the millennium.
Other transformative developments include the construction of a federal courthouse in 1999, and the opening of the convention center (2004) and the landmark Institute of Contemporary Art (2006). Seaport accessibility was greatly improved thanks to the Central Artery Project (also known as “the Big Dig”) in 2006, a controversial project that provided the foundation for the city’s explosive growth. The endeavor included the creation of the Silver Line bus service, which runs from Logan Airport through the Seaport to South Station.
With the completion of the Big Dig, it became clear that there was “an opportunity to develop a new city” in the Seaport, recounts Charles Leatherbee, Skanska’s executive vice president for commercial development in Boston, which has constructed multiple office and residential projects there since, including a 225,000-square-foot (21,000 sq m) office project in the marine park that broke ground in June. Observes Leatherbee, “Make no mistake, the Seaport has access to the single greatest resource the city has—the harbor—and they’ve been able to develop something quite cool, in my view.”
Development of the Seaport had already begun in earnest in the mid-2000s, as the Boston-based Fallon Company began development of the 21-acre (8.5 ha) Fan Pier waterfront site in 2005, and Morgan Stanley and BGI followed with the purchase of the Seaport Square site in 2006. But plans for all projects were put on hold when the recession hit.
Projects slowly began to resume as the recession faded, but the deal that accelerated commercial development was Fallon’s signing of Cambridge, Massachusetts–based Vertex Pharmaceuticals to a $1 billion, 15-year lease for 1.1 million square feet (102,000 sq m) at Fan Pier in 2011. Skanska USA followed with speculative construction of 101 Seaport Boulevard, a 440,000-square-foot (134,000 sq m) office tower, and leased the majority of the asset to PwC prior to completion. Skanska USA then broke ground on 121 Seaport Boulevard in 2015, a similarly sized elliptical tower also built on spec, and fully leased it before completion in 2018.
Not all of the Seaport office development has been new construction, as Boston-based Synergy Investments began purchasing undervalued Class B office buildings in the Fort Point section in 2011 and, true to Menino’s vision, began leasing them to tech firms that were attracted to the large floor plates and brick-and-beam architecture. Jamestown purchased the Boston Design Center and a portion of the adjacent 1.4 million-square-foot (130,000 sq m) Bronstein Building in the marine park in 2013 and created a tech hub that landed Reebok as its largest tenant in 2016.
“The Seaport has been an absolute tenant magnet,” Jodka says. The district has led all Boston submarkets in absorption over the last decade, and rental pricing for both Class A and B space has doubled since the end of the recession—and not just in the gleaming new office towers. For the first time, the brick-and-beam Class B space in the Fort Point section is commanding higher rents than the low-rise portions of the Financial District towers. The Seaport has also been a hotbed for investment sales, with multiple properties fetching over $1,000 per square foot ($10,764 per sq m), including Skanska’s then-record sale of 101 Seaport Boulevard to Union Investment Real Estate of Germany for $452 million ($1,027 per sq ft/$11,054 per sq m) in 2016.
Perhaps even more remarkable than the performance of the Seaport’s office market has been the residential sector, for both rentals and condominiums. The Fallon Company was again a catalyst, developing 465 luxury apartments with 20,000 square feet (1,900 sq m) of much-needed restaurant and retail space with Park Lane Seaport in 2005. But what truly spurred residential construction was Cresset Development’s 2012 completion of Liberty Wharf, a mixed-use office and retail plaza that features a handful of popular restaurants, including a three-story, 20,000-square-foot (1,900 sqm) Legal Seafoods.
“That created a restaurant destination in the Seaport, and that’s when residential development accelerated,” explains Travis D’Amato, managing director at Walker & Dunlop. In 2013, Gerding Edlen completed 315 on A in Fort Point, a 202-unit luxury apartment building. “And once [developers] saw that those high-end rents could be supported, that’s when things really ramped up,” says D’Amato.
The Drew Company’s Waterside Place (236 units), Tishman Speyer’s 100 Pier 4 (369 units), and Clarion Partners’ Watermark Seaport (346 units) soon followed, which led to the development of the aforementioned Benjamin and Via apartments, Boston’s largest mixed-use project in over 30 years. Developed by the Berkshire Group, Boston Global Investors, and WS Development and opened in 2017, rents range from $2,537 for a 384-square-foot (36 sq m) studio at the Via to $9,731 for a three-bedroom, 1,246-square-foot (116 sq m) unit at the Benjamin—and both buildings are near capacity.
Condominium development followed the success of the rental apartments, with Fallon delivering 108 units at 22 Liberty in 2015, which sold out within six months of completion at prices exceeding $2,000 per square foot ($21,527 per sq m). Fallon added another 120 condos with 50 Liberty in 2018, and Tishman Speyer is constructing 106 units at Pier 4, which are achieving pre-delivery pricing in the “high $2,000s,” according to D’Amato. The success of the apartment and condo market paved the way for Cottonwood Management’s massive EchelonSeaport project in Seaport Square, which promises to introduce a new “luxury destination lifestyle” concept to the Boston residential market when it opens in late 2019.
The 1.33 million-square-foot (124,000 sq m) EchelonSeaport (designed by CBT, KPF, and Jeffrey Beers International) will comprise 447 condominium units in two tiered towers, with an additional 270 rental apartment units in a third building. An astounding 50,000 square feet (4,600 sq m) of amenity space be will included, as well as a coworking “innovation center” for residents. Rebecca Mattson, head of East Coast development at Cottonwood Management, says she hopes that the project will help address one of the principal criticisms of the Seaport—that the district lacks the feel of a real neighborhood.
Mattson says that with its preponderance of rentals, the Seaport is by definition more transient, with less community involvement than neighborhoods anchored by homeowners. But she is encouraged by the effect that condo developments at 22 and 50 Liberty, Pier 4, and now EchelonSeaport can have on the Seaport. “You’re starting to see more of that homeownership, which I think will really start giving the neighborhood a different vibe,” she says. “It will feel more like a real neighborhood, so we see [Echelon] very much as plugging into the Seaport community as well as—because of our size—the ability to create a sort of internal community as well.”
Despite the commercial success of the Seaport, there is still the major concern that looms in the background for every coastal development: the risks associated with rising sea levels and extreme weather. Last winter, Boston was reminded of those risks: a pair of powerful nor’easters generated unprecedented flooding in the Fort Point district. Seaport Square was largely unaffected, which may be attributed to some aggressive resilience measures incorporated during its construction.
In July, the Boston Planning & Development Agency issued a request for proposals to resilience consultants to develop zoning recommendations for a flood resilience zoning overlay district and to design guidelines for new construction and building retrofits to bolster the city’s earlier work on climate-change readiness. Brian Swett, director of cities and sustainable real estate at Arup, says that the resilience measures are nearly unprecedented. “The line that they drew for this zoning overlay is looking at the 1 percent–chance storm event in 2070 with 40 inches [102 cm] of sea-level rise,” Swett says. “And I’m only aware of one other city that has implemented those steps so proactively, so I think that Boston can serve as an example to numerous other coastal cities as they go down this path.”
When all is said and done, developers and the city of Boston hope the same will be said of the Seaport.
Some 2018 ULI Fall Meeting attendees will enjoy a sold-out tour of the Boston Seaport area, which is also home to the Convention center where many of the other meeting activities while occur.