Development: Ground-up Condominium Construction
Address: The Mezz South Boston, Boston, MA
Neighborhood: South Boston
Year Built: 2018
PROPERTY: 5-story, Class A residential & commercial asset currently under construction, comprising of 42-residential units and a commercial unit at street level, a two-floor parking garage in the lower two levels consisting of 43 parking spaces. The 35,500 SF of living area includes a billiard/recreational room, spacious building-common roof deck and private balconies in over half of the units.
Located on West Broadway Street, the Property sits directly in the middle of South Boston’s busiest street, providing endless dining options and numerous local retailers.
PRICING: Purchased for $8.25MM ($192k/unit) in Q3 2018, BPV anticipates the remaining construction expense to amount to an additional $391k/unit (HC & SC).
- BPV acquired the Property with a building permit ‘in hand’ from a developer who was only looking to sell the asset once permitted.
- The property was a dilapidated movie theatre that was sitting vacant since the 1970’s. BPV jumped at the opportunity to acquire and develop an asset in one of Boston’s hottest neighborhoods as well as to bring life back to what was an eyesore for current residents.
- South Boston’s West Broadway corridor sits within a recently re-zoned area that allows for higher density living and construction.
- The development is in a premier location due to its proximity to downtown Boston (3 miles), Logan International Airport (3.3 miles) & all local highways as well as the accessibility to MBTA bus lines and the Red Line.
- Through the use of combining private equity and bank financing, BPV is able to bring a high quality product to market comprised of over 50% residential units which are anticipated to be under agreement pre-completion.
- The average days-on-market for condominiums in the immediate area is 40 days, quantifying the pent up demand for additional condominium products.
- With the construction costs nearing $585k/unit and anticipated sales of over $720k/unit (including the retail unit at street level & 5-units deeded affordable) BPV knew that with a well-managed construction phase, the deal would be profitable to all involved.
- BPV actively targeted the creation of smaller residential units as we believe the reduced average unit size represents a unique opportunity for the market with a highly demanded and completely under supplied unit size and price point.