Boston Real Estate Observer, Author at Boston

W Hotel Boston to Create 200 Jobs

July 23, 2009 By Boston Real Estate Observer

Earlier this week, in an effort to get ready for the currently planned late October opening of the W Hotel Boston, the Starwood brand hotel held a job fair, or as they call it, talent auditions.

The hotel portion of the 235 hotel room and 123 luxury condo development at the corner of Tremont and Stuart Streets is poised to open in several months, creating approximately 200 new jobs for the Theatre District of Boston.

Approximately 6,000 people have already applied for jobs at the hotel. For more information on employment opportunities at the Boston W Hotel, visit the talent center at 660 Washington Street to apply for a position, or their career website.

Has Boston Ritz Carlton Lost its Mystique?

July 17, 2009 By Boston Real Estate Observer

When it opened its doors to both residents and guests in 2001, the Ritz Carlton Hotel & Towers Boston Common offered a new level of luxury to Bostonians who sought the comforts of the condo-hotel lifestyle, the aura of the Ritz Carlton name, and some of the most prominent views in the city. Eight years later, the development remains one of the most popular luxury buildings to call home in downtown Boston, but, have the high-end accommodations lost some of their mystique?

Turnover in the development has slowed over the past several years, while inventory is up, and the number of days it is taking to sell a unit is higher than past years. There are over 300 luxury condominiums spread across the two Ritz Carlton Towers that sit at the junction of Avery and Washington Streets in Midtown, a stone’s throw from Boston Common. Since the Ritz’s inception, there have been a large handful of luxury condominium developments to hit downtown Boston, but it was only recently that a large-scale luxury development, 45 Province, came online in the Ritz’s backyard.

“Luxury is not diminished by company. The entire Boston market has moved toward full service buildings, elevators, concierge, and quality management. Boston has become a well to do city. Buyers are looking for and paying for the best of the best of the best,” says William Shirreff, a residential sales agent with Otis & Ahearn, who currently has multiple listings for sale at the Ritz Carlton.

Since 2006, when 56 condos sold in the development (an approximate 18% turnover rate), the number of units that have sold at the Ritz has continued to decrease year on year. For the first six months of 2009, there has been six (6) sales at the Boston Ritz Carlton condos, significantly behind the pace of 2008 total sales of 36. Coupled with a high inventory of 35 currently available units in the development, the numbers alone beg the question of whether the Ritz Carlton condos are beginning to lose their momentum as one of the most coveted condo developments in downtown Boston.

“For me it is the location of the Ritz Residences that is the distinguishing difference. Every full service building has unique characteristic that attracts particular buyers. I like the easy access to transportation, e.g. the new ramps to the Expressway at the end of Essex Street, four “T” transit lines within a block, and short walks to Financial District, Theater District, Charles Street and Copley Square, and the Common and Public Garden at your door,” comments Shirreff.

The median list price for the 35 currently available luxury units is $1,369,000 (while the $1,918,457 average is a much higher number than the median mainly due to the $8.5 million listing price of Manny Ramirez’s penthouse), with an average price per square foot of $980, and average days on market (DOM) of 142. If compared against 2006 – 2009 sales data (table below), DOM may continue to rise for currently available units given a potentially inflated average price per square foot asking price.

Regardless of the numbers, the classic Ritz name and brand, along with the amenities and location of the development, will continue to drive interest in units at the Ritz Carlton Boston.

“It is the features associated with a particular unit that attracts buyers more than a particular floor plan. Light, view and terrace or balcony are features most mentioned by buyers. The particular units I’ve found that “wow” a buyer are the penthouse in the North Tower, the “E” units on high floors in the South Tower, and the units with terraces available in the Ritz III Residences,” says Shirreff.

Filed Under: Midtown Condos Tagged With: 02111 Boston Condos, Boston Ritz Carlton

Boston W Hotel & Condos Readying

July 8, 2009 By Boston Real Estate Observer

The pedigree of Boston’s luxury condo-hotels began in the 1980s, with the launch of condos linked to the Ritz (now the Taj), Four Seasons, and Boston Harbor Hotel’s Residences at Rowes Wharf.

The Boston W Hotel & Condos was the last major condo construction project in Boston to be fully financed before the global economic downturn hit, and when it launches at the end of this year, it will be the final large-scale condo development that hits the market for the next 2-4 years, With the mystique of the global W brand, it is one of the most highly anticipated projects the city has seen.

Some quick facts about the Boston W Hotel & Condo development being built at 100 Stuart Street in Boston’s Theatre District include:

The Hotel (on the lower floors of the building) is scheduled to open in the September / October 2009 timeframe.
Buyers will begin to move into the Boston W condos in approximately 5-6 months.
Condo openings will take place in two phases, with lower floors opening first, spread out over the December 2009 / January 2010 timeframe.
Percentage of units Under Agreement (including penthouses) is relatively strong, especially in light of the building being marketed for just six months.
Current preconstruction prices range approximately from $430,000 for a studio to $4,550,000 for one of the largest penthouses, with price per square foot ranging from $700 to $1,400 depending on floor level, unit type, and location within the building’s footprint.
Studio units and smaller one-bedrooms are not accompanied by a deeded parking space in the onsite underground garage.

Condos at the W will begin on the 16th floor, and top out at the 28th floor penthouse. The approximate 235 hotel rooms will be on lower floors, which garners condo residents preferential city views. Floors 16 through 27 will house 9 to 10 condos per floor, including an occasional 520 square foot studio unit, while the penthouse level will be home to 5 generously sized condos.

Interior condo buildout is presently underway, and customizations, including the combining of units, is being entertained – something that would be much more difficult (and costly) as the building is completed.

Filed Under: Theatre District Condos Tagged With: 02116 Boston Condos, 100 Stuart Street, Boston W Hotel Condos

Downtown Residential Market Status

July 7, 2009 By Boston Real Estate Observer

After moving through June, traditionally one of the most active months of the year for real estate transactions, the downtown Boston residential real estate market shows interesting signs of vitality.

Over the course of 2007 to 2009, during the month of June, the number of listings that sold (see table immediately below) in downtown Boston has steadily decreased, along with average list and sale price. Sale to list price ratio has remained relatively steady in the mid 90 percentile, in part meaning that homes continue to be priced by Sellers in line with the expectations of Buyers, albeit, on average, lower.

The amount of time that a property is remaining on the market, however, has been decreasing year over year. And if we look at a snapshot of what homes are/were on the market in June of each year from 2007 through 2009 (see table immediately below), inventory levels are staying relatively steady (with a slight increase). The average list price for a home in downtown Boston has trended up, yet this is largely a function of multiple $10 million + properties that are on the market currently.

While the data herein represents an admittedly small slice of current market conditions, and thus it’s dangerous to make too many far reaching assumptions based off of a cursory analysis, some insight is provided. Rather than focus on (the decline of) average list and sale price of homes in downtown Boston, a figure that can be swayed by a potentially unrepresentative mix of homes actually sold during the analysis, let us key in on the average days on market (DOM), along with inventory levels, and sale to list price ratio. The amount of choice Buyers have on the market is as good as it has been in several years, however, homes are being priced relatively accurately (in the context of what Buyers are willing to pay versus the expectations of what Sellers are willing to list at), and relatively speaking, units are selling faster than they have over the past several years.

Data was compiled using the Boston MLS (MLSpin) across the downtown Boston neighborhoods of Back Bay, Beacon Hill, Financial District, Leather District, Midtown, North End, Seaport District, South Boston, South End, Fenway, Theatre District, Waterfront, and West End.

Filed Under: Boston Condo Statistics

Boston Architects Win Design Award for Cape Cod Home

July 2, 2009 By Boston Real Estate Observer

Local (South) Boston architecture firm Ruhl Walker Architects, was recently honored with a Residential Architect Design Award (RADA) by Residential Architect Online. The merit award that Ruhl Walker Architects won is part of the 10th annual residential architect design awards, a competition that received more than 1,100 entries in 16 categories. Just 44 projects were recognized for honors, making RADA the most competitive residential architecture awards program in the country.

The winning design is for a 1,400 square foot modern home that was designed with the utmost respect for preservation of the surrounding land in Truro, MA on Cape Cod.

Residential Architect Online writes that Brad Walker, Principal at Ruhl Walker Architects, proposed renovating an 1820s house that sits on the inland edge of the lot as a primary residence, then building a retreat on the water. His design features a two-bedroom concrete base burrowed into the sand and topped by a glass pavilion. The long, narrow footprint barely disturbs the dunes’ regular shifting pattern, and existing dune trails link the old and new structures.

“We are still struggling with how best to leverage this project, partly because it is part of a conceptual effort, and due to circumstances beyond our control, will never be built,” says William Ruhl, Principal at Ruhl Walker Architects. The firm is currently exploring opportunities with interested parties to build the home on similar land elsewhere in the world.

This is not the first time that designs of the Boston architects have been awarded. Ruhl Walker Architects has designed multiple high-end lofts across the city, including lauded designs in Wilkes Passage and Channel Center. Their expertise spans across free-standing homes, condos and lofts, as well as commercial spaces.

Filed Under: Boston Architecture Tagged With: Ruhl Walker Architects

Buyers Prepare for 1850 Condo Auction

June 24, 2009 By Boston Real Estate Observer

Just over a year ago, Buyers and Investors had the opportunity to participate in the last downtown Boston condo auction at the Broadluxe (see Broadluxe Condo Auction Results). On Sunday, June 28th, those interested in purchasing downtown Boston real estate will again have a chance to do so at auction prices when the 1850, a 60-unit loft-style condo development in the South End, goes to auction.

High Level Auction Information

What: 35 condos at the 1850 Lofts
Minimum Bids: $175,000 for some units
Auction Date: Sunday, June 28, 2009 with check in at noon
Auction Location: Westin Boston Waterfront (map)
Prerequisites: Auction Registration Form & $5,000 cash equivalent

Registration is required to attend the auction and to become eligible to bid. Interested bidders are encouraged to tour the 1850 prior to the auction (tours are available daily starting at 1pm at 90 Wareham Street in the South End), and during the visit complete and return the Auction Registration Form, which will qualify you to bid. On auction day, all approved registered bidders must present a separate Cashier’s Check, Traveler’s Check, Certified Check or Money Order (“Cash Equivalent”) in the amount of $5,000 (Cash Equivalents should be made payable to yourself). Each bidder is also required to bring a blank personal check, which will be used to bring your total down payment to 5% of the winning bid price.

The auction has the potential to provide Buyers and Investors with a significant discount on price per square foot and average selling price in the South End. Over the past 3 and 6 months respectively, the South End has seen modest price improvements across average and median prices, as well as price per square foot at the neighborhood level – see information below.

Last 3 Months – South End
Number of Condos Sold: 158
Average Selling Price: $594,727
Median Selling Price: $513,750
Average Price per Square Foot: $575
Average Days on Market: 94

Last 6 Months – South End
Number of Condos Sold: 225
Average Selling Price: $584,875
Median Selling Price: $510,000
Average Price per Square Foot: $568
Average Days on Market: 100

Bear in mind that the 1850 is located in one of the most southern points in the South End, and therefore, this fact and others may need to be accounted for when trying to draw price comparisons. Contact your Buyer’s Agent for more information (note that a Buyer’s Agent must be present at the time of registration and first visit to the Auction Information Center in order to work with a Buyer).

Bidders should be warned that a condo auction bypasses many of the contingencies that a Buyer is afforded during a “typical” real estate transaction. It should be noted that proper due diligence, including inspection of the property as well as other items standard in a transaction (including consultation with a real estate attorney) should still be conducted, however, these items need to be conducted ahead of the auction and by the Bidder. Bear in mind that a Purchase and Sale Agreement, typically signed after a fair amount of du diligence is done, will be signed on auction day by winning Bidders.

Filed Under: Boston Condo Auctions Tagged With: 02118 Boston Condos, Boston Lofts, The 1850 Lofts

1031 Exchange Basics

June 24, 2009 By Boston Real Estate Observer

Savvy real estate investors know that the 1031 Exchange is an important tool that, when utilized properly, allows the investor to defer capital gains tax on property that is sold at a gain. So what is a 1031 Exchange? A 1031 Exchange is an exchange of one property (referred to as the “relinquished property”) for another like kind property (referred to as the “replacement property”) under the rules of Internal Revenue Code §1031. In a 1031 Exchange, the investor places the proceeds of a property sale in escrow with a “qualified intermediary.” These funds are then used to purchase the replacement property, and the investor does not pay tax on income gained from the sale of the relinquished property.

The requirements of a 1031 Exchange include: (i) the transaction must be an exchange through a qualified intermediary as opposed to a sale and purchase; (ii) the replacement property must be like kind to that of the relinquished property; (iii) the same taxpayer must dispose of the relinquished property and acquire the replacement property; (iv) both properties (i.e. the relinquished property and the replacement property) must be held for investment purposes or for use in the investor’s business; (v) to defer all tax the replacement property must be greater in value, equity, and debt than the replacement property; and (vi) replacement property must be properly identified pursuant to IRS §1031 within 45 days of the closing of the relinquished property.

While it has been established that a personal residence is not eligible for a 1031 Exchange as it would violate the requirement that the property be held for investment purposes, IRS Revenue Procedure No. 2008-16 has created a safe harbor for property held for productive use in a trade or business or for investment under Section 1031 even though the taxpayer occasionally uses the property for personal purposes. However, the property must meet certain qualifying use standards, which include, for both relinquished and replacement property, minimum requirements for length of ownership and days rented, as well as maximum requirements for days used for personal use. The other key aspect of the qualifying use standards is that the relinquished and replacement properties must be rented at fair market value.

Through proper planning and analysis, real estate investors can leverage the 1031 Exchange to their advantage. However, that analysis and the rules governing it can be quite complex. Therefore, please consult with your legal and tax advisors as you contemplate your next 1031 Exchange.

Filed Under: Real Estate Investing

CVS Replaces Restaurant at 285 Columbus Lofts

June 19, 2009 By Boston Real Estate Observer

285 Columbus Lofts on the border of the Back Bay and South End opened to much success, and despite the development recently selling out, the ground floor commercial space has remained vacant since the inception of the building. According to inside sources, the space remained empty as a suitable high-end restaurant was found. Adding such a restaurant to the ground floor of the development would put it on par with such developments as Trinity Place, the Albert A. Pope Building, Folio, and Allele. The residents of the building, and the local neighborhood are surprised to see that the pending restaurant signs have come down to make way for a CVS Pharmacy.

With the arrival of a new CVS Pharmacy, gone is the potential amenity of on demand gourmet meals for residents that accompanies condos with an onsite restaurant. However, there are some condo owners who would prefer not to have food, and everything that comes with having a restaurant below you, in the building. Certain condo developers purposefully construct buildings with the intention of not having food on the ground floor commercial space, take the Lofts at 36 A for instance, which intentionally limits the types of tenants that can occupy its ground floor commercial space.

Filed Under: Back Bay Condos Tagged With: 285 Columbus Lofts, Columbus Avenue Condos

Is Condo Auction Pace Quickening?

June 16, 2009 By Boston Real Estate Observer

It was almost a year ago to the day that Bostonians saw their last downtown condo auction take place at the Broadluxe on June 21, 2008. Prior to that, roughly two years had gone by since the last downtown Boston condo development auction at Folio was used to clear out inventory at the Financial District luxury development. And now, with the June 28, 2009 auction at the South End’s 1850 loft-style condo development taking place, this may be a sign that the large-scale condo auction market is heating up.

Brecht recently stated that there may be a chance for increased auction activity over the next 24-36 months (see 441 Stuart Street: What Happened?), and it appears that prediction is coming true in the form of another residential downtown Boston real estate auction now with the 1850.

The 1850 is a condo development that has been developed over the past several years, gone through a name change (formerly known as SoHa Lofts), has been marketed for sale for well over a year, and open to residents in mid-2008. Both the Folio and Broadluxe auctions were successful in quickly clearing remaining inventory and paying off creditors, and the 1850, while some would argue has a less desirable location, is positioned to be on the same trajectory.

Filed Under: Boston Condo Auctions Tagged With: 1850, Boston Lofts, Broadluxe

True Back Bay Lofts

June 4, 2009 By Boston Real Estate Observer

We oftentimes get questions from condo buyers about what loft style condo options there are in the Back Bay. Boston’s Back Bay is considered one of the most premier and desirable neighborhoods to call home, and historical rowhouses and ornate townhomes dominate the tree lined streets. That said, finding a trendy loft-style condo in the heart of the Back Bay is naturally difficult.

Buyers won’t be able to find a classic exposed brick and beam loft-style condo in the Back Bay, it’s just not really an option. What condo buyers do have access to is 360 Newbury, which represents probably the most modern and contemporary living option in the Back Bay, and gets you the closest to Back Bay lofts. From the entrance (picture below), and up through the elevator ride to the units with big windows and big views, 360 Newbury exudes the hip, slightly edgy, but luxurious feel of loft-style living.

Turnover in the 54-unit building is relatively low, however, there are currently four units available for sale at 360 Newbury, two one-bedroom units and two two-bedroom units, ranging in size from 869 to 1,626 square feet, and in price from $699,000 to $1,599,000.

Filed Under: Back Bay Condos Tagged With: 360 Newbury, Boston Lofts