Skyscraper downsizes
Winthrop Square project hit by coronavirus financial worries
The huge project at Winthrop Square in downtown Boston has the OK to drop some residential units and switch from condos to apartments — which also means that developers Millennium Partners is going to be putting up $26 million less for a promised affordable-housing project.
The Boston Planning & Development Agency board on Thursday unanimously signed off on Millennium Partners’ request to cut 90,000 square feet from the multi-tower skyscraper project, and to make the change from expensive condominiums to expensive apartments.
The largest tower will still be 691 feet tall — one of the largest buildings in Boston — but now the secondary tower will be smaller with 90,000 of the original 760,000 square feet of residential space shaved off of the project at 115 Winthrop Square.
The project will now total 1.45 million square feet, with 321 rental units plus office and commercial space. The developers had torn down the city-owned garage they bought for $150 million, and laid the foundation for the new building before they paused building under the coronavirus pandemic.
Joe Larkin of Millennium Partners said the changes come because of the coronavirus pandemic and the economic crisis that’s accompanied it, with lenders balking at the $800 million price tag, and the fact that the housing units were condos.
“We got caught where our lender was very concerned,” Larkin said, insisting the reduction of $100 million in project cost and the switch to apartments would allow the company to secure funding in the next two months or so.
In response to questions, Larkin said the change from condos to apartments does mean that the $48 million in linkage fees generated from the luxury project that had been meant to create affordable housing now drops to $22 million.
That cash had been meant to help pay for a 155-unit mixed-income building on what’s right now a BPDAowned lot in Chinatown, but plans are ongoing.
“We have to figure out how to plug that gap,” said Devin Quirk, the BPDA’s head of real estate, said of the lesser dollar amount.
Larkin vowed that Millennium will continue to work with its partners in the area to get that building done.
“We’re still committed to seeing this project forward here,” Larkin insisted. “Over the next year we’ll be able to solidify that project.”
Quirk said the BPDA had commissioned consulting firm Ernst & Young to see if Millennium’s assertions had merit, and the firm found they did. Quirk said the report said these changes were “necessary to move the project forward.”
BPDA board member Ted Landsmark thanked Millennium for hanging in there, saying, “I have a feeling that we might be hearing from other developers who may be facing similar challenges at this moment.”