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THE REAL
Reporter
50 T H E A N N U A L R E V I E W
®
Synergy Scales New Heights in Hub
B
BY JOE CLEMENTS
OSTON — In the commercial real estate
ballgame, Synergy Investments compares well to Red Sox MVP Dustin
Pedroia—shows up before everyone else,
relentlessly dives into its pursuits and usually
does something productive— oft times amazing— with the object once secured. And in
2014, the Synergy team
got a coveted trophy (fittingly in October) landing
with GreenOak a 445,000sf downtown office building at a consideration of
$143 million as the firm
founded by Irish native and
DAVID GREANEY
PricewaterhouseCoopers
accountant David J.
Greaney leapt into another
league entering its second
decade in the industry.
The contingent housed
at 100 Franklin St. was
active on both sides of the
transactional field last seaBRIAN CROSSE
son, reaping $52.7 million
from a 103,000-sf Seaport
District office building
acquired for $10.5 million
in Oct. 2011 and $8.8 million from 4 Liberty Sq., a
boutique 27,000-sf property Synergy had since Jan.
2008, that asset as in the
MATTHEW GODOFF case of multiple others of a
more modest scale the firm
cut its teeth on while compiling a substantial fiefdom of Class B product.
They are concentrated
along the MBTA Red Line
which runs from Alewife in
Cambridge (home of a
MAURA GRIFFITH MOFFATT
Synergy asset at 10
Fawcett St. that sold for $31.3 million in 2013)
and out to Braintree, with holdings in Synergy’s
51 MELCHER ST., BOSTON MA
TEN POST OFFICE SQUARE, BOSTON MA
“
Dave (Greaney) is the
poster child for monetizing
some nice gains he earned
by having the guts to buy
early when everybody else
was running away.
”
FRANK F. PETZ
JLL Capital Markets Managing Director
control one station from Boston at North
Quincy where the firm owns 350,000 sf at 100
Hancock St. and 200 Newport Ave. bought separately via C&W in 2011.
Minus that assemblage, Synergy has primarily owned Back Bay, downtown and Seaport
office and mixed-use assets, among them former warehouse-turned-office buildings overlooking Fort Point Channel at 250 and 253
Summer Street which serve as that booming
district’s gateway and where 51 Melcher St. is
perched a few blocks away and now owned by
a European investor, Zurich Capital, after
Synergy took a vacant building, renovated it
and leased the building to full capacity.
“It’s incredible,” Cushman & Wakefield
Executive Director Matthew E. Pullen remarks
of Synergy’s steady ascension that began with a
modest mixed-use project in Dorchester. C&W
has brokered a number of Synergy’s transactions, 10 Fawcett St. and 51 Melcher St. among
them, while another C&W exclusive paid off
handsomely in the Seaport District for Greaney
and company when the group paired with Hub
heavyweight DivcoWest to buy 353,000 sf in
multiple office buildings and a parking garage
for $53 million in May 2013, then sold 319 A
St. last summer for $12.5 million while the
garage brought $56 million alone in an early
January purchase by Multi-Employer Property
Trust and advisor Bentall Kennedy. Those two
assets had cost $42 million in the May 2013
package and all of those deals which C&W brokered were initially unveiled by Real Reporter.
An ornate 13-story building across from
Post Office Square’s lush Norman B. Leventhal
Park, Ten Post Office Sq. was sold on behalf of
Broadway Real Estate Partners which had paid
$108 million for it in April 2006, a deal also
processed by the C&W Capital Markets leadership comprised of Robert E. Griffin Jr. and
continued on page 126
THE REAL
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126 T H E A N N U A L R E V I E W
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SYNERGY’S NEW HEIGHTS
continued from page 50
Edward C. Maher Jr. along with Pullen. Ten Post
Office Square is home to several premier tenants including Arrowstreet Architects, Boston
Private Bank & Trust Co., Leggat McCall
Properties and the Real Reporter.
In assessing Synergy’s meteoric rise in a competitive market, Pullen points to a hands-on
approach and its founder’s ability to understand
complex real estate trends and crunch numbers.
That acumen is not always a strong suit for
investors especially on debt plays as was executed to begin 2014 when
Synergy secured 10 Milk St.
in downtown from its overwrought
management
through assuming a
defaulted $58 million loan
held by its securitized
lender. “That is a real skill,”
JAMES F. GRADY
Pullen says of a maneuver
savvy local groups such as
the Davis Cos. have used to
their
advantage,
24
Farnsworth St. in the
Seaport one recent instance
for that firm which bought
the $13.3 million loan in
2012 then took over the
KEVIN KILEY
building and sold it this
past January to the Unitarian Universalist
Association at a price of $25.4 million.
At 10 Milk St., Synergy spent approximately
$252 per sf to gain control, well below the
$350-per-sf and up similar properties have been
yielding. JLL this past month finalized the $18.2
million sale of One Milk St., that equating to an
impressive $475 per sf. “This was a complex
transaction that took months of focus, discipline
and perseverance to complete,” Director of
Investments Maura Griffith Moffatt reported of
10 Milk St. after its conclusion and relaying that
the firm sees “excellent opportunities as these
TEN MILK ST., BOSTON MA
141 PORTLAND ST., BOSTON MA
complex loans dating to before the recent recession continue to mature.”
JLL Managing Director Frank F. Petz is anoth-
“
This was a complex
transaction that took
months of focus, discipline
and perseverance
to complete.
”
MAURA GRIFFITH MOFFATT
on Synergy’s loan assumption
at 10 Milk St. Boston
er fan of Synergy and its founder, and not only as
a fellow expert on debt and structured finance
matters. “Dave (Greaney) is the poster child for
monetizing some nice gains he earned by having
the guts to buy early when everybody else was
running away.” says Petz, his team delivering
$327 per sf in the sale of 4 Liberty Sq., part of
that operation’s specialty trading well-located
Boston office buildings in the middle market
range, often high-end Class B product.
Regarding Ten Post Office Sq., Petz says
Greaney is “upping his game in a big way” in
pairing with New York based GreenOak, a past
investor with Synergy in eight different endeavors. “Dave has really gone from an entrepreneurial player to an institutional investor,” says
Petz. “And that is a great combination because
he still has his entrepreneurial skills but now he
is working with some of the largest capital
groups in the country on some very big assets.”
Pullen says Synergy has also assembled a
core of “absolute professionals” to keep up with
the expanded portfolio, among them real estate
attorney Moffatt, leasing director James F. Grady
and finance whiz Brian Crosse, who hails there
by way of Ireland and such stateside firms as
Delaware North. They have been joined over the
past year by Pam Adamian and Chad J. Boulay. A
25-year industry veteran, Adamian arrived in
November after time with TA Associates Realty
and most recently New Boston Fund where she
oversaw a portfolio of four million sf. “Pam
brings a wealth of experience to the team, and
will significantly increase Synergy’s overall asset
management capabilities,” Moffatt said in a
press release issued to announce Adamian’s hiring, adding “her addition is a testament to our
ability to attract high-caliber leaders to the firm.”
Chad J. Boulay also was responsible for
about four million sf at HallKeen Management
before being hired this winter, with prior stops for
him including Equity Industrial Partners, Tishman
Speyer (One Federal St., Boston) and Wellesley
continued on page 127
141 TREMONT ST., BOSTON MA
THE REAL
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T H E A N N U A L R E V I E W 127
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SYNERGY’S NEW HEIGHTS
continued from page 126
Management. “When I first came in, Dave gave
me very clear and explicit instructions, and that
was to make this the best property management
group in the city of Boston,” Boulay said at the
time when 31 buildings and
3.5 million sf was in the
portfolio. Other group leaders on the Synergy squad
include Director of Asset
Management
Matthew
Godoff and Director of
Construction Kevin Kiley.
PAM ADAMIAN
“They are very capable
in every way” of taking on
Ten Post Office Sq., Pullen
relays in pointing to the
nearby 2 Oliver St. that has
225,650 sf and improved to
90 percent occupancy since
the investor paid $52 million in Dec. 2012. That asset
CHAD J. BOULAY
also acquired via C&W is
now on the market for sale listed by them, as therealreporter.com unveiled in early April.
Greaney has kept plenty of brokerage shops
busy over the years, and 2014 was no exception. DTZ was on the case in North Station as KS
Partners paid $7.2 million to buy 141 Portland
St., a three-story, 22,650-office building that
the new owner has since filled. David J. Pergola
and Brian R. Doherty run DTZ’s Capital Markets
platform. The JLL crew marketing 4 Liberty Sq.
included Petz, Managing Director Jessica
Hughes and Vice President Robert Borden. It
closed in early August versus mid-September on
141 Portland St. That property was acquired in
Feb. 2006 for $3.5 million, less than half what
it brought from KS Partners.
NECCO STREET GARAGE, BOSTON
A major Synergy deal cemented in 2014 that
closed in late January of this year through HFF
involved 27 School St. (62,425 sf) and 141
Tremont St. (68,650 sf) going to a Japanese
investor. Nippon Telegraph and Telephone (NTT)
doled out $48 million compared to the $27 million the seller had spent in July 2007.
HFF Capital Markets member Benjamin
Sayles explains his firm’s global outreach that
has a special yen for Asian capital introduced
NTT to the Boston arena and to Synergy’s assets
that were almost completely filled when
exchanged. The investors coveted the tenancy,
location and views, Sayles told Real Reporter
after the group that included Senior Managing
Director Coleman Benedict and Patrick McAneny
closed on the package, the all-cash commitment
of which was originally detailed in early January
by Real Reporter. HFF Senior Managing Director
Riaz A. Cassum runs the firm’s global initiative
and helped source the acquisition.
u
319 A ST., BOSTON MA
HAMILTON CO.
continued from page 52
As the half-billion dollars doled out since
the recession attests, Hamilton Co. was much
busier buying through 2013, a year that it paid
$52 million for apartments at Douglas Park in
the South End. The firm was willing to pay the
price whenever doing so was deemed worthy,
as they did in Oct. 2009 outpacing a stable of
national suitors to win Dexter Park in Brookline,
a 409-unit high-rise on the edge of Boston near
Fenway Park and the Longwood Medical Area.
Hamilton’s bravado rocked the market in
aggressive pricing and having beaten out the
institutional set for a property many coveted, and
Valeri says there has been no hard swallowing
since in committing more than a quarter of its
capital outlay to the nine-story structure that
dates to 1972. “We couldn’t be happier,” he
reports. “It is well-constructed and extremely
well-located.” They knew that going in, he
explains, crediting the firm’s longevity and insular focus of activity inside Route 128 for being
fully aware of Dexter Park’s mettle when put on
the block through CBRE/NE multifamily team
Simon J. Butler and Biria St. John. As usual, New
England’s top multifamily team did bring together a global lineup of prospects but they were
supplanted by the company whose headquarters
is barely a mile away. Today, Dexter Park’s net
operating income is up dramatically, Valeri says,
and occupancy remains in the high 90 percent
range while urban multifamily is a darling among
1085 BOYLSTON ST., BOSTON MA (RENDERING)
investors everywhere, enhancing its future value.
On the multifamily development stage,
Hamilton intends to concentrate on the middle
arena where “they aren’t making any more”
product, especially in the upper range of that
class. Valeri maintains “people won’t want to
pay $3,000 a month for an apartment,” fretting
that could bloat vacancies on the luxury front, a
class where there does appear to be a surge in
construction and Valeri claims some owners are
offering free rent and other concessions, a nettlesome sign if true.
“That has kept us a little more bridled,”
Valeri accedes of the acquisition appetite, and he
speaks of more than a few listings where
Hamilton determined the anticipated target allocation to be unreasonable “and in those cases,
we chose not to participate” in the bidding
process. “When it starts to get like this, the best
idea is to keep your powder dry and sit back for
the right opportunity to come your way,” he says.
Development is another avenue, he says,
and Valeri maintains the efforts are in line with
civic efforts to increase housing, especially in
the middle market. The Fenway venture is taking
that a step further; rents in the $2,000 per
month range are well below comparable product and Hamilton is donating revenues from the
development to a charitable trust for several
community organizations. Being erected on a
parking lot, the six-story building will have all
one-bedroom apartments averaging 600 sf and
spaces for 18 vehicles on the site bought in
2011 for $2.6 million from Richard Cohen. u