Two things have to happen before Mayor Menino retires: 1) He needs to—we assume—get a hobby, because otherwise he'll be bored. And 2) apparently, everyone needs to get a project approved.
They're coming out of the woodwork, resurrecting stalled or complex projects to get into the unusually long line for approval at the BRA. (It's starting to look like the line for a One Direction concert.) Since the mayor's late March departure announcement, filings have jumped at least 35%. The BRA expects that by year-end, an additional $3.7B (8.4M SF) will get into construction. It's reviewing another $3.9B (11M SF) and has already approved projects valued at $12.6B (36.7M SF). The mayor's transformative accomplishments are indisputable. He rebranded the waterfront as the Innovation District, now one of the nation's hottest markets. And Fenway, LMA, and several neighborhoods are booming thanks to a good economy, reviving capital markets, and the friendly city administration.
One project comes from The Druker Co, seeking permission to build a 308k SF, 11-story office at 80 E Berkeley St, a site that's sat empty for years. (So if you hid something there, you better go retrieve it ASAP.) Prez Ron Druker says the timing has to do with new zoning rules and a strengthening office market. Caesar'sEntertainment and partner Sterling Suffolk Racecourse (the owners of Suffolk Downs), signed a community host agreement with Boston on Tuesday, and on Friday started permitting for their $1B resort casinobefore the state gaming commission granted them the sole license available for Eastern Mass.
It's the "not knowing" who will succeed Mayor Menino that's creating anxiety among developers, says Mount Vernon Co chairman Bruce Percelay, who plans to soon start permitting a project. It's hard to imagine an environment more conducive to business than the one created by the Menino Administration, he tells us. Will a new mayor carry on that legacy or change course? (It was either Voltaire or Tom Petty who once said: "The waiting is the hardest part.") There's a "real motivation" to expedite. Bruce is building a large mixed-use multifamily complex in Allston and expects to permit a new project soon.
There's "absolutely" a rush to get projects permitted, says Jacobs Kling Stubbins principal Scott Simpson. His architecture firm is working with Skanska USA Commercial Development on a new office at the Innovation District to be anchored by PwC. They received anearly excavation permit and started construction in August although Scott doesn't expect it will receive all final city approvals until late fall. In addition to the mayor's departure, BRA director Peter Meade has already announced his January retirement.
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Developers are generally uncomfortable with uncertainty, says Edwards Wildman Palmer partner Rebecca Lee, a longtime real estate attorney and former BRA chief of staff. The tempo of the development review and approval process has accelerated in the waning days of the Menino Administration. Not only will there be changes at the top of the city administration, new faces are likely to appear throughout the development system—in departments,commissions and boards within and outside of government. (Now we're gonna have to re-learn everyone's names and food allergies.) Since some development policies are governed by mayoralexecutive order, such as including affordable housing in market-rate residential projects, substantial changes could be on the way, Rebecca says.
HRV Development principal Jordan Warshaw, with partners Garyand Jeff Saunders, is permitting 40 Trinity Place, a $225M hotel/condo/retail project near Copley Square. He says they aren't part of the developer stampede. They started seeking city approvals in early '12, well before Mayor Menino's departure announcement. Theeconomy, and a project's design and suitability for the location are more important than who's sitting in the corner office at City Hall, he tells us. But, if the mayor and his colleagues don't like a project, a developer's life can be difficult. Accordingly, the Trinity team worked to get input from the mayor and other key stakeholders before bringing their plan public.
The mayor will leave a legacy of accountability and an even-handed process that will survive his departure, says The Hamilton Co CEOHarold Brown (above with Hamilton prez Carl Valeri). He expects the company's charitable foundation to start construction in two weeks on a 40-unit multifamily building at 1085 Boylston St in Back Bay. The company is permitting another 70-unit residence on Malvern Street in Allston. This summer, it completed a 50-unit building in Downtown Crossing which is 100% leased. Developers have geared-up because the economy has turned around, demand is strong, and capital markets are providing money to build, he says.