In a vote taken after it closed its final public meeting, the Mass. Turnpike Authority board on Thursday revised a development agreement to speed the first phase of the Fenway Center, a large, mixed use project that also involves the creation of Yawkey Station, a full-service commuter rail stop, and a multi-modal center near Kenmore Square and the Longwood Medical Area.
Transportation officials, who earlier in the day promoted a press conference on the accord but declined to discuss details, said the board’s vote occurred in closed executive session, which was convened to discuss real estate negotiations after the board voted to end its last public session, forcing the media out.
The developers behind the $500 million, 1.3 million square foot project, which includes nearly 1,300 new parking spaces, are John Rosenthal and Meredith Kenmore (MK), New England Sports Ventures and the Boston Red Sox.
In an interview, Rosenthal said the agreement recognizes market conditions by deferring rent payments tied to a 99-year air rights development lease while requiring upfront payments tied to appraisal values of land involved in the 4.5-acre project. Rosenthal estimated air rights payments at more than $300 million over the lease period.
“I’m thrilled with the vote,” he said. “It’s a very smart way to jumpstart a major development project.”
The project depends upon low-income housing tax credits and so-called new markets tax credits and also includes conditional financing commitments from a host of entities, including the Mass. Housing Finance Agency, the Executive Office of Housing and Community Development, and the AFL-CIO Housing Investment Trust.
The first phase of the project involves construction of Yawkey Station, at a cost to the state of $12 million, with $12.5 million in state-funded roadway improvements around the station. The first phase of Fenway Center includes a pair of 100-unit housing developments and a 700-space garage with a large solar power component.
According to Boston Redevelopment Authority Director John Palmieri, the Yawkey Center project "will significantly transform the public realm between Kenmore Square, Fenway and the Audubon Circle."
State transportation officials said the new agreement, worked out over eight months, positions the state to receive "significant financial benefits" tied with the second phase of the project's development. Transportation officials were unable to estimate the value of upfront payments or future payments. Colin Durrant, spokesman for the state transportation secretariat, said the revised agreement was not available to review because it has not been finalized.
The development still requires final approval from state environmental officials, but the state's top official in that arena is already singing its praises. In a press release, Energy and Environmental Affairs Secretary Ian Bowles said the Yawkey Center "has the potential to be a leader in limiting greenhouse gas emissions from real estate development" and described the solar power and commuter rail aspects of the project as "the kinds of creative steps I am looking for as this project proceeds through state environmental review."
In 2007, the turnpike authority designated MK for development of the property and an agreement was executed in 2008. The new rent structure in the revised agreement addresses problems created by deterioration in the real estate and credits markets that made the project less feasible under the original agreement, state officials say.
Rosenthal said his involvement with the turnpike over development possibilities dates back to at least 2002 and that he hoped to work with state officials on development plans for other parcels of turnpike air rights.
