Q1-2018-OfficeReport
CAPITAL MARKETS STATISTICS Property Property City/Submarket Westwood
Property Property City/Submarket City/Submarket Buyer
40 Court Street 40 Court Street Boston Exan Capital LLC $54,000,000 Boston Exan Capital LLC $54,000,000 109,705
101 Station Driv 101 Station Drive AEW Capital Mana AEW Capital Ma $53,100,000 $53,100,000 208,134
Buyer Price Total SF Price/SF Cap Rate Total SF Price/SF Cap Rate Buyer Price
City/Submarket Westwood
Buyer Price Price Total SF Price/SF Cap Rate Total SF Price/SF Cap Rate
MEDIAN $/SF $177 109,705 $492 4.0% $492 4.0%
208,134 $255 6.50% $255 6.50%
SALES VOLUME ($)
NUMBER OF TRANSACTIONS
TOTAL SF
MEDIAN CAP RATE
$704,191,923
55
4,135,512
6%
Sale Volume
Sale Volume SALES VOLUME $4,000
TRENDS • Following a rather lackluster second-half of 2017, transaction volume failed to make headway in Boston’s office market during the first quarter. With that said, Boston remains a highly-desirable destination for capital among all investor types and the limited inventory of available properties for sale continues to drive up pricing. Similar to national office trends, suburban investment is on an upswing, with the median price-per-square-foot increasing by more than 30% over the past year. This compares to just 1.6% growth in the urban markets. • Investors seeking higher yields and greater opportunities are driving the expanded suburban investment activity in recent quarters. Three out of the top four largest office transactions took place in the ‘burbs, with CrossHarbor Capital Partners; $277 million purchase of Cross Point in Lowell representing the top deal. Spear Street Capital’s $88 million acquisition of the former Reebok campus in Canton was another major sale that closed during the first quarter. National development sold 101 Station Drive in Westwood to AEW Capital for $53.1 million or $255 per square foot and Minardi Limited Partnership picked up two assets on Donald Lynch Boulevard in Marlborough for $13 million or $104 per square foot. • When Downtown assets do change hands, buyers pay a premium. Exan Capital recently purchased 40 Court Street, a 109,705-square-foot Class B asset in the Financial District for $54 million or $492 per square foot at a 4% cap rate. Stars Investment paid just $31 million for the building in 2014. The sale of 28 State Street is reportedly nearing completion, with an estimated price tag of $430 million or $745 per square foot. This would represent a 25% price increase from the asset’s 2014 sale.
$3,500
$4,000
$3,000
$3,500
$2,500
$3,000
$2,000
$2,500
$1,500
$ (000s)
$2,000
$1,000
$1,500
$ (000s)
$500
$1,000
$0
$500
2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018
$0
Suburban Urban
2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018
Suburban Urban
MEDIAN PRICE/SF Median Price/SF
Median Price/SF $700
$600
$700
$500
$600
$400
$500
$300
$400
$200
$300
$100
$200
$0
$100
2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018
$0
Suburban
Urban
2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018
TOP Q1 / INVESTMENT SALES
Suburban
Urban
INDUSTRIAL SALES
Q1 2017
Q2 2017
Q3 2017
Q4 2017
TOTAL
SALES VOLUME ($) Former Reebok HQ Canton Cross Point Lowell
$374,173,554 101 Station Drive Westwood
$453,379,723 Former Reebok HQ Canton
40 Court Street Boston
$385,172,081
$433,947,886
$1,646,673,244
# OF TRANSACTIONS
76
78
82
60
296
Spear Street Capital CrossHarbor Capital Partners $227,2 , $88,000,000
TOTAL SF
4,779,432
6,394,205
4,045,511
4,243,774
19,462,922
Buyer
Buyer
Exan Capital LLC
Buyer
AEW Capital Management
Buyer
Spear Street Capital
MEDIAN $/SF
$75
$59
$103
$86
$90
Price
Price
$54,000,000
Price
$53,100,000
Price
$88,000,000
Total SF
680,000 1,282,212
Total SF
109,705
Total SF
208,134
Total SF
680,000
Price/SF
$129 77
Price/SF
$492
Price/SF
$255
Price/SF
$129
Cap Rate
-
Cap Rate
4.0%
Cap Rate
6.50%
Cap Rate
-
7
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