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Bentall Lands Berkeley Portfolio; Could Pay $205M for Seaport Gems

October 08, 2015 — By Joe Clements

BOSTON—In yet another eye-catching Seaport District commercial property ownership shift, Bentall Kennedy has agreed to acquire a portfolio of office buildings and parking garages put on the block this summer by Berkeley Investments through the Capital Markets platform led by Robert E. Griffin Jr., Edward C. Maher Jr. and Matthew E. Pullen. Industry sources claim the real estate investment advisory firm whose national platform has been laser-focused on Boston in recent years will pay upwards of $205 million for the entire package save for 381 Congress St., with that asset being harvested on its own, its pricing seen in the $25 million sphere.

“Yes,” one industry expert familiar with the negotiations remarks to therealreporter.com regarding whether rumors about the group’s designation as winning bidder for the “Seaport Selection” assemblage are accurate. The buildings being acquired are 22 Boston Wharf Rd., 343 Congress St., 12 Farnsworth St. and parking garages on Farnsworth and Stillings Streets. The holdings were assembled back when other investors were shying away from the area that was still feeling the impacts of the Big Dig project and a capricious real estate market that struggled in the early to mid-2000s.

Berkeley acquired 343 Congress St. (pictured) in summer 2003, buying the 111,575 sf former garage-turned-first-class office space by its predecessor, Intercontinental Real Estate Corp. of Brighton. A year later, Berkeley shelled out $97 million for 22 Boston Wharf Rd. and other long-held assets from Boston Wharf Co., the major landlord in Fort Point throughout the 20th century before carving up its fortune to multiple buyers. Also included in that portfolio purchase were 332, 368, 374 and 381 Congress St., 12, 33, 34 and 38-42 Farnsworth St. and 5 Stillings St.

Berkeley upgraded the structures into a blend of uses including office, high-end residential and retail in a campaign that has contributed to the Seaport’s Fort Point Channel being reborn from a fringe office district to one of the country’s fastest growing mixed-use neighborhoods anchored by a diverse lineup of commercial companies including architects, attorneys, life sciences firms and burgeoning technology startups.

Bentall Kennedy and MEPT have made several substantial Seaport deals in recent months, including its purchase of a 588-space parking garage in January for $56 million acquired from a partnership of DivcoWest and Synergy Investments, early adherents of the Seaport who are like Berkeley making out handsomely in their foresight. Bentall’s other major purchase there occured this winter through HFF involving a package of three office buildings totaling 221,000 sf for which the advisory firm paid $105.5 million, those assets being 300 A St. plus 313 and 330 Congress St..

Bentall Kennedy and MEPT have been active in other parts of metropolitan Boston, joining forces in late 2014 with Leggat McCall Properties on a medical office play in the South End that could foment other uses as well including multifamily In 2012, Bentall acquired the Woburn Mall north of Boston, a power-center retail plaza being harvested by Christopher Angelone and William Moylan, now at JLL although they will represent CBRE/NE in that deal which was listed prior to there move to rival JLL.

Efforts to contact the brokerage team handling the exclusive and the parties involved were unsuccessful
as of press deadline, but Bentall does reportedly have the asset tied up, with one question being if MEPT is participating in the venture as well, with Bentall representing many investors in its position as one of the country’s leading CRE advisors. Sources could not say what the timing is for a closing on the portfolio or what the strategy is regarding 381 Congress St., said by one market observer to have been taken out of the lineup due to matters unrelated to its condition. That source maintains the asset is being pitched to other suitors separately and predicts the Seaport location will garner interest much the way Berkeley’s final piece there drew a supposed Who’s Who of regional, national and overseas investors.

Yet another massive Seaport deal involving the Griffin team that joined Newmark Grubb Knight Frank this past week from their longtime home at Cushman & Wakefield is also nearing a conclusion, in that instance Tishman Speyer agreeing to acquire the 500,000-sf State Stree Bank headquarters a few blocks west of Berkeley’s fiefdom. As therealreporter.com was first to unveil on Tuesday, Tishman could pay close to $325 million to owners Ares Management and Commonwealth Ventures for the newly constructed tower. That and the Berkeley listings are being traded under the C&W umbrella even though Griffin and dozens of colleagues are now at NGKF at 470 Atlantic Ave.