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).