One of Boston’s top developers, a self-described half-glass-full guy, says he remains bullish on commercial real estate despite the rise of remote work during the coronavirus pandemic.
Tom O’Brien, the founding partner and managing director of the HYM Investment Group, has two big projects under development – a massive mixed-use complex at the site of Suffolk Downs in East Boston and a mixed-use project called Bulfinch Crossing at the former Government Center garage. Combined, the two projects call for 6.35 million square feet of office space.
O’Brien acknowledges the nature of office work has changed during COVID, but he doesn’t think the change will affect commercial real estate as much as some people think.
“I’m not part of the hand-wringing crowd that says there’s going to be a drastic reduction in office,” O’Brien said on The Codcast. “I do think that the way people work will change, that’s for sure. It will be more flexible. But we still fundamentally need offices; we need cities because those are the places where people gather. That’s where they collaborate. That’s where they produce good ideas. That’s where we’re able to converse with one another. That’s still the future of cities and office.”
State Street Bank announced in 2019 that it was moving its headquarters from 1 Lincoln St. to Bulfinch Crossing and occupying 510,000 square feet. O’Brien said State Street is not planning to reduce its footprint in the new building, although the company is paring back its office space elsewhere.
O’Brien said prospective tenants are still trying to decide how much space they need post-COVID. Some, he said, may actually end up purchasing more space to spread their employees out more, while others may cut back and make do with less space.
“It’s a mix,” he said. “There could be some reduction, but I don’t see a drastic reduction.”
He said one factor in his favor at Suffolk Downs is space set aside for life sciences companies, which are thriving and growing. “That space is doing very, very well,” he said,
O’Brien said the fundamentals of the office market remain strong. With his own firm, O’Brien said, he has noticed the difference at meetings where some people are attending in person and some are there via Zoom.
“The people who are on Zoom during a meeting when people are there in person, it just doesn’t work,” he said. “You can’t fully participate as a Zoom person while people are in the room. What’s going to end up happening is those sorts of awkward situations are going to drive this kind of return to the office process.”
The developer said he’s been through recessions before in Boston and this one may pose a tougher recovery, in part because hospitals and universities, which often pursue capital projects during the downturns, haven’t been able to do so this time because they’ve been hard hit by COVID-19.
But O’Brien said he thinks the fundamentals in Boston are sound. “No matter how we get into the recession, no matter where we go, at the end of the day Boston still ends up being a place that [lines up] well within the world economy and remains a popular place,” he said. “For the most part, Boston is going to find itself in the right place again.”
O’Brien said his gut tells him the ghost town that is currently Boston will return to its crowded state again.
“We’re all anxious to get back out there, see people again. Boston is such a small town,” he said. “I would suggest there’s going to be an explosion of people wanting to be outside, wanting to go to events, going to restaurants, going to hear music. It’s going to be a really breathtaking opportunity to get back and re-engage with people. I’m looking forward to it, and I know millions of people are as well.”
Finances are now taking center stage on the Allston I-90 project, with officials warning that if a finance plan doesn’t come together they will go with barebones repairs rather than a complete reimagining of the area.
A shopping bag held the key to continued safe in-person school instruction in the small town of Harvard, and the Baker administration is trying to replicate the one-off initiative across the state.
Rare closures of prison space are prompting home confinements and transfers.
Divided reaction within the state Republican Party to the violence in the Capitol reflects the split within the party.
Schools roll back reopenings amid rise in COVID-19 cases.
With the help of a tax credit in the recent stimulus package, Mayflower Wind cuts the price of its power by 10 percent.
FROM AROUND THE WEB
Some lawmakers say they will donate their pay raises this year to charity. (Gloucester Daily Times)
The economic development bill now on Gov. Charlie Baker’s desk would seal no-fault eviction records. (MassLive)
Business leaders who were initially wary of former union leader Marty Walsh at the helm of Boston city government quickly warmed to his business-friendly ways. (Boston Globe)
Students in Mount Wachusett Community College’s nursing program are frustrated that their graduation date was suddenly delayed because of a lack of available clinical placements due to the pandemic. (MassLive)
A significant increase in opioid-related overdoses on Cape Cod is blamed on COVID-19 lockdowns. (Cape Cod Times)
Hundreds of Massachusetts first responders – police, firefighters and EMS – will start receiving COVID-19 vaccines today. (MassLive)
The House may move quickly to consider a second impeachment of President Trump — but then delay for several months referring the charges to the Senate for a trial in order to not overshadow President-elect Biden’s first days in office with a trial. (New York Times) Rep. Stephen Lynch calls a second impeachment of Trump “the right thing to do.” (Boston Herald) The Daily Hampshire Gazette and the Berkshire Eagle both call for Congress to hold President Trump accountable for the violence at the Capitol, with the Eagle referring to the president as the “commander in chaos.”
House Speaker Nancy Pelosi shows what was done to her office in the attempted takeover of the Capitol and Georgia Secretary of State Brad Raffensperger walks through Trump’s call pressuring him to find enough votes to overturn the results. Raffensperger also documents how Rudy Giuliani falsely alleged election fraud. (60 Minutes)
In his first interview since the mob invasion of the Capitol, outgoing Capitol Police Steven Sund said he made repeated requests for more help prior to and during Wednesday’s riot but was rebuffed. (Washington Post)
President-elect Biden is tapping William Burns, a career diplomat, to be director of the CIA. (New York Times)
Therese Duke, a UMass Memorial Health Care employee, is identified as a pro-Trump protester in Washington who grabbed a US Capitol police officer then was punched in the face. A Central Massachusetts restaurant owner, Jeff Eller, is criticized for traveling to Washington and describing the protests as peaceful. (MassLive)
President Trump is giving New England Patriots coach Bill Belichick the Presidential Medal of Freedom. (Associated Press)
Boston Police Commissioner William Gross is reported to be “90 percent” of the way there in launching a campaign for mayor. (Boston Herald) He’s not the law enforcement official with an eye on politics, as US Attorney Andrew Lelling confirms that he could make a run for office at some point. (Boston Herald)
Michelle Wu, who declared her candidacy for mayor last fall, picks up a high-profile endorsement from her former Harvard law professor, Elizabeth Warren. (Boston Globe)
Republican strategists say President Trump’s obsession with conspiracy theories pushing the idea that the presidential election was stolen from him — and his preoccupation with his own fate at the expense of the looming dual Senate runoffs in Georgia — wound up costing the party control of the Senate. (Washington Post)
Gov. Charlie Baker is building up his campaign war chest, raising $165,000 last month and stoking speculation that he will run for a third term. (Salem News)
Despite a new round of stimulus checks, fewer than 4 in 10 Americans could handle an unexpected $1,000 expense such as a medical bill or car repair. (USA Today)
The pandemic is fueling renewed interest in union representation for health care workers. (NPR)
Worcester’s hot real estate market means property assessments are rising so property taxes are going up. (Telegram & Gazette)
The Ashland Public Schools are offering free COVID-19 tests to all students, teachers, and administrators today. (MetroWest Daily News)
Worcester Tech makes changes to its admissions policy for next year on an emergency basis, to make it more equitable, with a longer-term analysis planned for the future. (Telegram & Gazette)
A judge suggests that a Lawrence man who is facing charges for running over a police officer’s foot while fleeing a traffic stop was racially profiled when he was pulled over. (Salem News)
A judge rejects claims by a Peabody HVAC contractor that Gov. Charlie Baker’s rules limiting capacity indoors and requiring mask-wearing infringe on people’s rights. (Gloucester Daily Times)
Marshfield’s top cop explains why he once “hated the police.” (Boston Globe)
A limited number of state jury trials will begin this week, with COVID precautions. (MassLive)
Amazon notified Parler that it would be cutting off the social network favored by conservatives and extremists from its cloud hosting service Amazon Web Services. (Buzzfeed)
Nancy Bush Ellis, a Massachusetts resident whose own politics were of a more liberal Democratic stripe but who was a devoted and fervent supporter of her brother and nephew, who both became Republican presidents, died at age 94. (New York Times)