The commercial market (be it office, retail, etc.) in Boston has been performing quite well lately, vacancy rates are low, and this is pushing rents up across the various classes of commercial buildings (office space for instance is broken down into classes, Class A buildings (the best of the best) command the highest rents, this for example, would be the Hancock Tower).
From an economic standpoint, the strong commercial market is a precursor to several trends that will slowly develop. First, as rents continue to rise across the various classes of commercial property, businesses will look to more less-traditional areas of the city to setup shop – the Seaport District, northern South Boston, and the Fenway are all obvious choices. Secondly, a natural by product of the build up of commercial space in other areas of the city is a bolstered residential condo market to serve that area.
That said, you will continue to see further buildout and prominence of the Seaport District (with FP3, Fan Pier (both commercial and residential)) and northern South Boston (Allele, Eleven West Broadway, 125 B Street), areas that we have been bullish on for some time now. Why are we excited about these areas? Well, you have multiple economic factors moving in favor of healthy and appreciating condo prices in the area – the commercial / residential thread just discussed, as well as a similar trend in the residential housing market in the core downtown area.
The latter trend of residential housing being similar to that of commercial property, in that Boston condo prices continue to appreciate in the core of downtown (approximately 6% in 2007), thus naturally moving Buyers into other areas (Seaport District, northern South Boston) where you can get more square footage for your money.
Add all of these things up, and you have good investment potential in Boston’s Seaport District and northern South Boston.
Keith Munsell 
I agree there will be great bargains for some time to come in the Seaport. The credit crunch has stymied a few residential projects that have now been sold off for office space. The biggest choice in considering the Seaport, on a personal level, is the lack of infrastructure. (groceries, dry cleaners, etc..) There are certainly now some deals in the south end that are in the same ball park and just as good of a long term bet.
Further infrastructure will be a natural result of the further commercial and residential buildout in the Seaport District, much like we are seeing in northern South Boston, with Pappas Properties adding a dry cleaner, cafe, yoga studio, and soon to be, organic market, to their Macallen / Court Square Press development. A new restaurant will go into the ground floor of the Allele development, and separately, Pappas has plans to build a larger grocery store deeper in South Boston – so, the Seaport will follow, but it will take some time.
The only place in the South End that you will find spaces that are consistently comparable to the Seaport is quite south into the South End, the infrastructure is more advanced there than in the Seaport, but it’s a fair distinction to make.