Cornerstone Buys Boston Trophy Tower for $110M
- Sep 06, 2013
Cornerstone Real Estate Advisers, a subsidiary of MassMutual Financial Group, has acquired 99 Summer St. in Boston from Normandy Real Estate Partners for $110.8 million on behalf of a Cornerstone-managed fund.
The 20-story Class A building consists of 272,614 square feet. Originally constructed in 1987, the tower features a five-story atrium lobby and has marble finishes, plantings, and skylights. The building’s exterior features finish granite with a red pyramidal roof and stepped office design. It also contains a two-level underground parking garage with 103 spaces.
Normandy purchased the property in 2006 and has invested a great deal over the last few years to improve the building, including updating the lobby and renovating the bathrooms and common areas. Its improvements have paid off, as the past year has seen leasing velocity rise to 140,000 square feet, which represents approximately 93 percent occupancy.
The sale of 99 Summer St. comes at a time of increasing activity in the Boston office market. According to Marcus & Millichap’s Office Research Market Overview for the- just-completed third quarter of 2013, as vacancy tightens closer to pre-recession levels this year, owners will realize the first positive year-over-year increase in rents since before the recession. Average asking rents will advance 1.9 percent to $26.42 per square foot by year-end 2013. Last year, asking rents fell by 1 percent.
The Marcus & Millichap report also revealed that Class A asking rents have been on a downward slide for the past four years, falling at an average 1.7 percent annually, but that the trend has slowed to a 0.1 percent decline in the last year to $34.88 per square foot.
The building is located near Downtown Crossing, Post Office Square, Boston Common and the Seaport/Innovation District. It’s also only a short walk to amenities including The Ritz-Carlton Hotel and Tower, Sports Club/LA, and numerous restaurants, shops, and services.
Eastdil Secured served as the broker for the transaction.