Fan Pier developer throws hands up, says he can't build a hotel, wants to build residences instead

Developer Joseph Fallon says the city and state have made it financially impossible for him to build a hotel on Fan Pier and so is asking the BPDA to let him build up to 245 new residential units instead.

In a letter to the BPDA, Fallon said that after ten years of trying, an agreement he signed calling for more than 23,000 square feet of "civic/cultural" space in the proposed hotel just doesn't work financially.

The required space, he writes, is just too large to make any sort of hotel - whether a full-service hotel with a ballroom and conference rooms or a barebones "limited service" hotel - work financially, especially with more recent demands by both the BPDA and state environmental officials that he provide "significant" financial support for building out the space to whoever rents it. That, he writes, would add "millions of dollars in additional and previously unanticipated cost."

Instead, Fallon wants the BPDA to let him amend his master plan for Fan Pier to build new residential units on the parcel on Harbor Shore Drive, kitty corner from the ICA. These, he writes, would provide enough income to pay for the stuff the city and the state want. He adds he has yet to figure out if he would build condos or apartments; he says that with condos, 155 to 170 units would be enough to ensure a profit, while with apartments, he would need to build 225 to 245 units.

Condos, he continues, would mean additional money paid into a BPDA fund for building or acquiring affordable housing in the city, while apartments would mean new affordable units on site. In either case, all the new units would help the city meet its 2030 goal for new housing.

Since acquiring the Fan Pier project in 2005, Fallon has overseen the transfiguration of parking lots and empty space on Fan Pier into the ICA, the two-building world headquarters of Vertex, two other office buildings and a condo development.

Falon's Fan Pier letter (2.8M PDF).

Ad:

Neighborhoods: 

Topics: 

Free tagging: 

Comments

Is this the same developer...

By on

.... who whined about having to maintain public access to the waterfront on a recent project?

up
Voting is closed. 53

Nah

By on

You're probably thinking of Cronin and the CLF lawsuit, etc. - this is Fallon.

up
Voting is closed. 41

I was.

By on

Thanks!

up
Voting is closed. 39

File Under: Why Housing is Expensive

By on

"These, he writes, would provide enough income to pay for the stuff the city and the state want."

When we demand excessive community benefits we end up with more expensive housing that can cover the cost of those benefits. The money has to come from somewhere

up
Voting is closed. 66

Exactly

By on

It's time to stop this practice of legalized extortion we call " mitigation."

up
Voting is closed. 64

Details are a legalized protection racket

By on

and shake down. Anybodywith at leasta room temp. IQ understands what's going on.

BTW: MA is the ONLY state thatdoes this; I guess the other 49 states have it wrong.

up
Voting is closed. 45

There is plenty to go around

By on

The money does come from somewhere. It is supposed to come from the profit the developer is making. It's enough for the developer to get a little rich off the development rather than a lot of rich.

up
Voting is closed. 59

Really?

By on

Why would anyone become a developer to only get "a little rich" if there's plenty of other ways to get "a little rich" that involve way less risk, work and stress?

up
Voting is closed. 32

You are being semantic. It's

By on

You are being semantic. It's perfectly reasonable to ask developers to include things for the communities benefit. It's an very lucrative market.

up
Voting is closed. 33

You're dreaming if you think that's the cause.

By on

Developers are selling these water-front units for top dollar. It's good that the city got a pound of flesh that can be used to, well anything really. Anyone who thinks that a developer would drop the price of a unit fro $6M to $5M without the community benefits is misguided, never mind into "affordable" range.. The developers will get whatever top $ they can get for these units. They will never give a discount price "to be fair".

up
Voting is closed. 55

The developer isn't gonna

By on

The developer isn't gonna list the condos for cheaper. Trickle down economics doesn't work. Even if the developer did then that would cause a bidding war among buyers and the unit would sell for what similar units in other buildings go for.

up
Voting is closed. 57

The irony of your comment being

By on

The developer wasn’t planning on building new housing, but due to requirements of his non housing proposal, he is now considering housing, including affordable housing.

My takeaway from your comment is that Boston should make it harder and harder to build anything but housing as a way to get housing built.

up
Voting is closed. 50

“When we demand excessive community benefits...”

By on

“When we demand excessive community benefits...”

Nothing excessive at all about these requirements. What is excessive is the developers’ and the speculators’ greed and demand for personal profit.

up
Voting is closed. 51

Ok, who's going to use the proposed space then

This is by the giant convention center, why do we need " 23,000 square feet of "civic/cultural" space" in a fairly low population neighborhood with limited public transport? Like what specific events are going to be held in this space? I mentioned the BCC because I would bet given the semi-public nature of that entity, they'd be more amenable to public uses on occasion of smaller halls if we really needed 23000 sq of civic space in the seaport.

To bring it back local (for me), if the substation were to have been intended to be a public use space, in the middle of the neighborhood on many bus lines and the commuter rail, that would make sense. But here on the pier? .

up
Voting is closed. 35

Yes, it’s also near ...

By on

....current and proposed ferry stops.
Fan Pier is an ideal location for public space. It’s near to downtown and to Boston’s most densely populated neighborhoods. The Seaport itself is growing.
It good to know the BPDA seems to be on the side of the community in this instance and is not swayed by this developer’s hissy fit.

up
Voting is closed. 54

What's the use though?

Seriously, what's an example of a civic event needing 23000 sq ft in this location? Like specially what would be in this space? Town hall meetings? Kickball league?

I'm not being snarky, I really would like to know...

up
Voting is closed. 38

I have no idea

You ask a fair question and there aren't many good answers. "Cultural/civic space" isn't well defined by those who use the term. Google search doesn't help much.

I guess, a library or a museum or a community room or a place for learning.

No, there isn't a use for it in the Seaport but that doesn't stop some people from demanding it.

up
Voting is closed. 37

Exhibit and meeting space in

By on

Exhibit and meeting space in this town is atrociously expensive. Even for a nonprofit group or charity event, the square footage to get a couple of meeting rooms or a ballroom is unreal, especially as you're competing with for-profit and corporate groups who are happy to pay that (and then pass the cost on to their attendees, who are expensing it to their company anyway...) Demanding more community spaces helps alleviate some of the crunch for smaller groups.

up
Voting is closed. 27

Sports fields,

By on

Like Brooklyn Bridge pier parks.

up
Voting is closed. 27

Good luck

You're going to get a bunch of replies from people who never built a shed in the backyard and worked for government/non-profit all their lives telling you how to run a business

up
Voting is closed. 48

Cool story bro

How's your reread of the Fountainhead going? Still a story told by an idiot, full of noise and emotional disturbance but devoid of meaning?

up
Voting is closed. 49

It's easy for people to call

By on

It's easy for people to call things excessive if they just want to complain about housing costs. That's not the reason prices are high. There are speculators in the market. A location like that will always be expensive if it's desirable. Housing needs to be blended into the larger area, not just units that are sold for money. If they aren't included when they are built, then they won't be included after unless the building is remade.

up
Voting is closed. 29