Financial details of the deal were not released, but according to local published reports, the group had originally offered $125 million. The transaction is expected to close this calendar year.
Last month, Miami-based Lennar Corp. was on board to pay a reported $125 million for the site, which is considered to be the heart of South Boston's waterfront. But the firm reportedly missed its down payment for the property opening the door for Stephen Karp, chairman of New England Development, and his group. Calls to the Lennar Corp. were not returned by deadline.
Nicholas Pritzker, the Chicago-based head of Hyatt, spent nearly three years getting the $1.2-billion hotel, office and residential complex permitted, but never managed to secure the necessary financing to move the project forward. Fan Pier is the largest development on the South Boston waterfront and its huge expanse currently sits nearly vacant. It is used largely for parking.
A spokesperson for Mayor Thomas M. Menino tells GlobeSt.com that the mayor is "encouraged" that locally based developers are purchasing the site. "The mayor has worked with Stephen Karp in the past and he knows that he will be able to make a contribution to the waterfront," notes the spokesperson, who adds that because Karp owns the adjacent Anthony's Pier 4 property he is confident that the development will occur in a more "cohesive manner."
Speaking for the joint venture, Karp says, "The development of the Fan Pier is consistent with our team's long-term vision of the growth of the City of Boston. We see this as one of the great development opportunities in the country."
The project is currently fully permitted and, as currently approved, consists of approximately three million sf in nine buildings. This involves 1.1 million sf for multifamily units--with 20% designated as affordable, 1.2 million sf office space, 140,000 sf of ground floor retail, restaurants and cafes as well as a 500 to 650-room hotel. Also incorporated in the plan are 2,285 spaces of underground parking and 107,000 sf dedicated to civic and cultural use including the new home of the 62,000-sf Institute of Contemporary Art.
The mayor assumes the new development team will stick to Pritzker's approved plan, the spokesman says. In a statement Pritzker says the new team "is committed to working closely with Mayor Menino and other civic and community leaders. New England Development, Boston Properties and the Related Cos. have assured us that they will keep faith with our commitments and vision for Fan Pier."
The members of the JV each bring their own expertise to the table. New England Development has worked on retail, waterfront and mixed-use projects such as CambridgeSide Galleria. Boston Properties has completed complex urban projects such as the recent Prudential Center expansion and redevelopment and the Related Cos. recently developed the 2.8-million-sf Time Warner Center in New York City's Columbus Circle.
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