One Winthrop Square Purchased by Chinese Investment Firm
Foreign investment in Boston commercial real estate is nothing new. The recent acquisition of an office building in downtown Boston by a Chinese real estate investment firm is just the latest example of the phenomenon – and it marks the second major move by a firm that is just getting started in Boston. Nan Fung Life Sciences Real Estate, better known as NFLSRE, is a local subsidiary of Hong Kong-based real estate conglomerate Nan Fung Group. Its acquisition of One Winthrop Square in downtown Boston likely means big changes for the building, including renovations that will help it to appeal more to life sciences firms.
The property in question consists of a five-story office building that offers a total of 115,667 square feet of space. Situated just blocks from South Station and adjacent to the under-construction Winthrop Center, it was last sold to MAPFRE USA Insurance for $55 million in 2015. NFLSRE has not announced any official plans just yet, but the company has stated its intention to help to develop more high-quality life sciences space in the city – and its acquisition of One Winthrop Square appears to be a step in the right direction.
NFLSRE opened its first office in Boston in November, but its acquisition of the downtown Boston office building is already its second major move in the city. The company recently invested $115 million to purchase 51 Sleeper Street in the Seaport District from Brookfield Properties. That property has been changing hands frequently lately; Brookfield acquired it for $91 million in 2019 and announced plans to rebrand the building. This included changing its name to Three Seaport and promoting the space to tech and innovation companies. At the time, the building was 70 percent occupied, and major tenants included the United Way and the Department of Early Education and Care.
Plans for 51 Sleeper Street also included revamping the lobby, renovating the ground-floor entrance and adding a new roof deck. However, none of those plans ended up coming to fruition. It is not clear what happened exactly, but Brookfield opted to sell the property instead. NFLSRE has not announced its specific plans for this property yet, but given that the firm focuses on the development of life-sciences real estate, it will probably be promoted as such. The building stands eight stories tall and offers around 152,000 square feet of space.
The area around One Winthrop Square is currently abuzz with activity. Winthrop Center, which is being constructed by Suffolk Construction right now, will span two towers and will include office space and residential space. All told, the development will offer 1.545 million square feet of space, so it will unquestionably overshadow the much smaller One Winthrop Square. At the same time, however, it is likely to cause an increase in demand for other types of space – and life-sciences space is particularly in demand at this time. Therefore, this is certain to be a smart move for NFLSRE.
One Winthrop Square is also located across the street from the brand-new Martin’s Park. The park is named in honor of the youngest victim of the Boston Marathon bombing that occurred on April 15, 2013. The parents of the eight-year-old boy who perished in the attack were instrumental in the creation of the $15-million park, which opened in June 2019. Located on one acre at Fort Point Channel, the park offers a green expanse of space that includes play equipment and benches. It is also located next to the Children’s Museum.
What does all of this mean for downtown Boston? It strongly suggests that a major push for life-sciences real estate is picking up steam in the heart of the city. While the Seaport and Cambridge have been hotbeds of life-sciences activity, demand for such space has been so rampant that developers see opportunities in many other parts of the city. However, the building at One Winthrop was built in 1873 and currently offers Class B office space, so NFLSRE will have to invest considerable money to make it attractive to life-sciences firms. As evidenced by what the company has said in press releases, it is planning to do so – it’s just a matter of when the work will actually begin. Stay tuned to Boston City Properties for more developments.