Developer Proposes Construction of Office Tower Atop Building Near Faneuil Hall
In a letter of intent filed with the Boston Planning and Development Agency on September 20th, Gazit Horizons Inc. proposed the development of an office tower atop Marketplace Center, a retail building connected to offices at 200 State Street. The real estate investment firm, which acquired the 62,000-square-foot retail property for $81.8 million in 2019, is a subsidiary of Tel Aviv-based Gazit Globe Ltd. In the U.S., the firm has offices in Boston, New York City and Miami and specializes in income-producing properties with mixed-use potential.
The LOI filed with the BPDA includes the first clear proposal for the site. The firm announced that it wants to add a 10,000-square-foot expansion onto the property’s ground-floor retail space. More notably, perhaps, the company is also proposing a 120,000-square-foot “vertical office addition” to the site. To make this happen, developers will have to remove a three-story galvanized canopy structure on the site. Gazit envisions the creation of a “grand portal” that will connect the Rose Kennedy Greenway and waterfront to the historic properties of Faneuil Hall, one of the most popular tourist areas in the city.
Because of the Covid pandemic, tourism at Faneuil Hall and surrounding areas has plummeted, affecting traffic at the site being developed. Last year, at the height of the pandemic-induced shutdown, Gazit sued one of the building tenants, Ann Taylor Loft, over missed rent payments. Other tenants at Marketplace Center include the Gap and Banana Republic.
In the LOI filed a few weeks ago, the real estate investment firm described the existing parcel as unattractive. Unlike nearby buildings, the property is not historic and doesn’t fit in with surrounding properties. Under the new proposal, the parcel will be revitalized to enhance the pedestrian experience, creating an easy way for people on foot to walk from Faneuil Hall to the waterfront with ease.
Since acquiring Marketplace Center from Clarendon Group USA, Gazit has been busy acquiring other properties around the city. In 2021 alone, for example, the firm acquired 341 Newbury Street in the Back Bay for $51 million. Its portfolio features many other prominent pieces of commercial real estate, including 41 Winter Street, 43 Winter Street and 467 Washington Street. With its acquisition of the property at 200 State Street, the firm hopes to help Faneuil Hall and surrounding areas recover more quickly from the ongoing pandemic.