News
EXCLUSIVE INTERVIEW: Fallon on Fan Pier, Condos Coming
June 27, 2011
| After kicking off the nation's largest private CRE construction project on Wednesday (the $900M Vertex HQ at Fan Pier), The Fallon Company?s Joe F. Fallon says he's feeling good. The project was four years in the making, and he says there's demand for more development around the waterfront. We sat down with Joe to discuss where he's been and where he's going. |
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| Joe with his indispensable executive assistant Graceann Cirame at their ONE Marina Park Dr office. There's 1.5M SF left to build on Fan Pier, and his next project will be a 100 to 150- unit building filled with that now rare breed: luxury condominiums. Joe's confident it will succeed, thanks to lots of calls from potential buyers. The building will sit at the water?s edge with unimpeded views of Boston Harbor. Joe plans to pick an architect this fall. Of course, he'll oversee construction of the two office/lab buildings for Vertex, a total of 1.1M SF. In Q3 or 4 next year, he'll start construction on the residences with completion slated for ?14. BTW … permits are already in place. |
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| Finance VP Sam Butler may not be thrilled about being a Bisnowpinup (or with that gargantuan stack of paper), but he's smiling about Vertex? option to lease a third off/lab building in the future of about 300k SF on Fallon?s Fan Pier site. This fall, meanwhile, the drugmaker will move into 60k SF that it will lease in The Fallon Company?s ONE Marina Park Dr. Things weren't so positive back in ?08. With financing in place for a one-building Vertex HQ, Lehman imploded and the stock market fell nearly 800 points. Joe says the moment when he heard the grim news in the Fan Pier marketing center, ?I knew we were in a downward spiral we wouldn?t get out of.? His lenders were Lehman and Goldman Sachs. |
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| Myrna Putziger, The Fallon Company's legal brain, crossed the ?t?s, dotted the ?j?s, and wrote and re-wrote deals that came together and fell apart as the economy reeled. In ?08, Joe and his financial partners, Mass Mututal and Cornerstone Real Estate Advisers knew the Fan Pier project would be a ?tough road? and they all put equity in to keep it alive. They worked with Vertex on building design and spoke with finance people to generate interest. Not until the second half of '10, did they see some daylight. And ?in real estate, two years is a lifetime,? Joe says. They secured approximately $350M in construction financing from Fortress, which invested in the first Fan Pier building (ONE Marina Pk Dr) and Starwood. Myrna looks forward to a day off, which will happen . . . eventually. |
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| Construction/Architecture EVP Richard Martini, here with Marketing Director Mary Benoit, know of Joe?s history at the waterfront. As Joe says, it started a decade ago, with the Big Dig. The new tunnels, bridges, and roads would give the waterfront transportation access unrivaled by any other location in the region, Joe says. With the new convention center progressing, Joe knew there would be people there. He developed the Park Lane Seaport rental apartments and Marriott Renaissance with lots of retail, primarily restaurants, which are performing ?phenomenally? well, as have other new waterfront venues. When Fan Pier became available in ?05, Joe did due diligence and says (forgive the double negative), ?There was no way it wouldn?t work.? |
