CAMBRIDGE, MA-MIT Real Estate is confirming the organization has bought into several properties owned here by Alexandria Real Estate Equities, with the REIT striking ground leases bearing a total value of approximately $30 million. According to MIT real estate associate director John McQuaid, the initiative is expected to provide a financial boost and steady income stream for the institution while at the same time allowing for reinvestment into the local economy.

“MIT is a big supporter of what is going on in Cambridge,” McQuaid tells “It is a market we understand and it is one we have a lot of faith in.” The ground leases have an initial term of 50 years, and carry a 25-year extension option.

First reported earlier today by, the series of four transactions came after extended discussions between the two sides. It underscores a close relationship forged last year when Alexandria paid $600 million for a 90% stake in Technology Square, McQuaid explains, with MIT previously acquiring that seven-building, 1.2-million-sf complex in the core East Cambridge submarket.

As in the case of the latest deals, the school stayed involved at Technology Square via a ground lease. That method has been used in the past by the organization, McQuaid notes, exemplified in the case of University Park at MIT, a major mixed-use complex that has helped revitalize Cambridge’s Central Square since work began there in the 1980s. The main developer is Forest City Enterprises, but MIT’s involvement helped clear the way for that ambitious project, one that abuts the school’s main campus.

The real estate investment arm of MIT is charged with finding revenue-generating opportunities, but McQuaid says the ability to put money back into the neighborhood is also of importance. “We want to do what we can to improve the area,” he says.

Based in Pasadena, CA, Alexandria secured the properties involved beginning in 2001 when it paid $35.6 million for 770, 784 and 790 Memorial Dr., the middle of which served as the long-time headquarters of Polaroid Corp. The 3.8-acre complex overlooking the Charles River was purchased by Alexandria during construction of 770 and 790 Memorial Dr., a pair of laboratory structures totaling 100,000 sf. According to McQuaid, the two new buildings are involved in MIT’s deal, and not 784 Memorial Dr. itself.

Alexandria subsequently acquired 161-171 and 170-176 Sidney St. in late 2005 for $4.8 million; paid $72.7 million for the 128,000-sf 300 Third St. in March 2006; and bought property on Brookline and Erie streets for $11.1 million a year ago this month, headlined by 99 Erie St. The total price paid by Alexandria for the properties involved in the MIT deal was $124.2 million. There is about 300,000 sf of existing space aggregate for the assets, which also includes extensive parking. The biggest price paid by MIT was $16.6 million to buy into 300 Third St., while the Memorial Dr. ground lease was placed at $12.3 million.

Calls to Alexandria were not returned by’s press deadline. One industry observer says the arrangement is unique in terms of the deal’s extended length. In the meantime, there are no encumbrances to prevent Alexandria from developing additional space on the properties, says McQuaid. “It’s up to them” to do what they want, he says.

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