Davis Buys in Waltham, Sells in Boston

WALTHAM, MA—An affiliate of the Davis Cos. has acquired two office buildings on Main Street here totaling more than 300,000 square feet for $52.5 million. The Boston-based firm also reports it has sold the Tower Point office complex in the Seaport District of Boston for more than $62 million.

The Waltham properties at 1025 and 1075 Main St., which total 303,460 square feet, were sold by an affiliate of KBS Real Estate Investment Trust. The deal for the properties was reported by Holliday Fenoglio Fowler, which represented the seller and procured the buyer. The firm also represented Davis Cos. and arranged a seven-year acquisition loan through Brookline Savings Bank and First Niagara Bank. Gramercy Property Trust, as asset manager, advised KBS on the transaction. The HFF investment sales team representing the seller was led by senior managing director Coleman Benedict and director Ben Sayles. The HFF debt placement team was led by senior managing director Riaz Cassum and director Brett Paulsrud in the financing transaction.

Its new asset in Waltham, the 1025 and 1075 Main St. property, was originally built by BayBank in 1980 as the bank's major operations center. The property since then has served similar functions for BankBoston, Fleet and Bank of America, who has been the anchor tenant at the property. Additional current tenants include Citizens Disability and The Cambridge Institute of International Education. The property features a cafeteria, fitness center and a four-level parking garage below 1075 Main St.

“Waltham has emerged as one of Boston's strongest suburban office markets and it is also experiencing one of the most significant building booms of the last 30 years, welcoming 14 new restaurants, more than 1,600 hotel rooms and several major mixed-use developments including City Point and 1265 Main St.,” said HFF's Sayles. “With this latest generation of office product and the associated retail components, Waltham will be able to offer the most demanding tenants an amenity-rich environment that is unparalleled in the marketplace.”

Quentin Reynolds, managing director with the Davis Cos., says the company is bullish on the Waltham suburban market that “offers tenants a combination of high quality office space with parking but also a very strong set of both walkable and drivable amenities.”

Reynolds says that Davis Cos. plans to reposition the property in the future. In the near term, Bank of America will be reducing its space at the property, thus bringing it from nearly fully leased to between 70%-75% leased.

In terms of its repositioning, the company is currently in the planning stages, but added that “we certainly are planning a significant repositioning of the asset.”

Davis Cos. also reports it has sold Tower Point, a 155,170-square-foot, Class A, brick-and-beam office building at 27 – 43 Woodworm St. in Boston to the Rockpoint Group, which is headquartered in Boston for $62.1 million. Newmark Grubb Knight Frank vice chairman Edward C. Maher, Jr. represented the Davis Cos. in this sale.

The Davis Cos. acquired Tower Point in August 2013 for a reported purchase price of $43.3 million and since invested in significant capital upgrades to increase the building's appeal to the creative and tech sectors. TDC demolished the building's low ceiling office spaces to expose the timber and brick construction and substantially increased the natural light in the tenants' spaces. The ownership also introduced modern finishes and functionality in the lobby and common areas and added a new 7,500-square-foot outdoor courtyard and patio. The Davis Cos. increased the building's occupancy from 74.3% at acquisition to 95% at the time of sale. Among the tenants at the property are: Rethink Robotics, Healthways, NPR, Zerto and Owner IQ.