AllianceBernstein Lends $31M Against University Properties in Boston
Danielle Balbi Aug. 6, 2015, 10:57 a.m.
Global asset management firm Alliance Bernstein provided a $31.3 million loan for the purchase and redevelopment of two university buildings in Boston’s Beacon Hill neighborhood, Commercial Observer has learned.
The borrower, JDMD Owners, a partnership between development firm Center Court Partners and New York-based investment firm Third Point LLC, purchased the Archer and Donahue buildings from Suffolk University for $43.5 million. JLL brokered both the sale and financing.
“The lending community was eager to back this project given the limited opportunities to finance a new, large-scale development in the Beacon Hill neighborhood,” Dustin Stolly, a managing director at JLL who helped negotiate the debt, told CO in prepared remarks.
The loan carries a floating rate over an 18-month term with a six-month extension option, another person familiar with the deal said on the condition of anonymity.
“The Archer and Donahue buildings are two well-recognized, landmark assets in one of Boston’s top neighborhoods,” said JLL Managing Director Frank Petz, who worked on the sale. “The market’s fundamentals are primed for residential development, given the very limited supply pipeline in the face of surging demand for urban living in Boston.”
Center Court has worked on a number of residential developments throughout Boston.
“The developer’s business plan is to convert the asset to residential condominiums,” Mr. Stolly said over the phone.
The two buildings, located at the corner of Derne and Temple Streets, previously served as Suffolk Law School. The university will remain a tenant in both buildings, which total 174,759 square feet.
“The sale of these buildings is an important step in providing students with technology-enhanced classrooms that encourage collaboration and innovation,” Suffolk University President Margaret McKenna said in prepared remarks. “The sale also provides resources for us to make important campus improvements that will foster exciting new working relationships among faculty, students and programs.”
Suffolk University is moving to its new building at 20 Somerset Street in downtown Boston in September of this year.
JLL Managing Director Aaron Appel and Senior Vice Presidents Heather Brown and Jon Schneider worked on the financing, while Managing Director Jessica Hughes and Senior Vice Presidents Michael Coyne and Travis D’Amato helped broker the sale.
A spokesman for AllianceBernstein declined to comment. Representatives for Center Court could not be reached. Third Point did not respond to inquiries by press time.—Danielle Balbi