Another Back Bay property goes for a fraction of its price just a few years ago

By adamg on Sat, 05/02/2009 - 7:09pm

Brecht Palombo attended the auction for 441 Stuart St., an office building that sold for $37.5 million in 2004 with the expectation it would be converted into condos. It wasn't, and when the auctioneer started the bidding at $30 million, nobody offered until the price went way, way down.

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Comments

An important point from that article

By neilv on Sat, 05/02/2009 - 7:27pm.

Where this market ends up remains to be seen, but one thing for certain is that we’re not out of the woods by a long shot. In fact we’re probably heading into the woods. Expect to see more auctions and more foreclosures on substantial properties like this as we move through the next 24-36 months.

Also note...

By Aaron on Sat, 05/02/2009 - 11:44pm.

At the opposite end of the market from enormous commercial properties (Hancock tower, the license to operate Faneuil Hall, etc):
http://blog.charlesgaterealty.com/bid/9247/The-Top...

Yes, that's a condo for $25,000. In Boston.

Not the best neighborhood and not the best condo. But still!

Agreed

By MT on Sun, 05/03/2009 - 9:00am.

I fear there is much financial dreck in commercial-property mortgage lending that has yet to surface. It's bubbled up in retail because of last fall's collapse in consumer spending but I think there are more sectors in line to tank. One candidate: Hospitals, especially in areas where they were built to serve a rapid expansion of single-family housing (so not in Mass.), but also just in general because credit was freely available everywhere.

not the worst thing

By david_yamada on Sun, 05/03/2009 - 8:15am.

The 2004 $37.5m price tag reflected a housing market was on steroids. The $17m price tag is likely more indicative of a market when it's not juiced up.

I'm loathe to use terms such as "market correction" where a family is taking a beating on a sale of their residential home, because it allows us to mask the financial pain inflicted. But situations like this one, where the original buyer no doubt saw an opportunity to convert to & sell condos for megabucks and at a huge profit, encompasses exactly the kind of insanity that led us to this place.

441 Stuart What Really Happened

By TRUTH on Tue, 05/05/2009 - 2:13pm.

You couldn't be further from the truth about 441 Stuart Street. This development was conceived to provide the cheapest new construction of studio and one bedroom condominiums in perhaps Boston's most desirable location. Close to public transportation, vast cultural amenities, jobs and even a bike rack for owners. It recycled a tired office building into a quality development. The majority of units while not dirt cheap were priced under $425k and the maximum unit price was slightly under $800k. There were also affordable units included in the development per City of Boston requirement that were priced under $250K. Furthermore, the developer was making a cash contribution to the City's Affordable Housing program and a voluntary contribution and repair to Ground Water Trust. Lets not forget the street scape improvements also being provided and paid for by the developer. What really happened to this deal was simply a case of greed and extortion tactics. That led the development team down the dark path of litigation and the rest is history. Do your homework before you write the blog.