Development blooms over downtown Pike

8 June 2001

Egos and economics drive real estate. Since 1997 they've combined to stop development of the nearly 44 acres of air rights over the Boston extension of the Massachusetts Turnpike.

Now that may be changing. The Turnpike Authority, once the bad guy in the Pike's construction battles, finally seems to be coming to its senses.

Four years ago, James Kerasiotes, the bullheaded director of the Turnpike Authority, cut a deal with New York developer Millennium Partners. Boasting that he, and he alone, controlled all of the permits needed for construction (incorrectly, as it turned out), he lured the company into proposing a massive, 59-story development in the Back Bay, at the corner of Massachusetts Avenue and Boylston Street.

Kerasiotes was driven by ego. He wanted to create a signature building that would alter Boston's skyline. And Millennium was only too happy to play along. The firm had developed its reputation as the creator of massive projects that, through their sheer size, would transform marginal areas. It had done so successfully in New York's Lincoln Square area; it is now poised to do so with its nearly completed Millennium Place development on the edge of Boston's Chinatown.

However, the Back Bay, with some of the highest real estate prices in the city, is hardly a marginal area. Rather than transformation, what it needed was interstitial development - the kind thatfills in gaps. Millennium, which had presold its project to potential investors, could never adapt its philosophy to this reality.

Still, the stake that ultimately killed Millennium's deal was economics. It costs more to construct a building on thin air than it does on land. But the Turnpike Authority made that difficult situation dramatically worse by demanding that Millennium pay it a huge premium of about $20 million for the air rights.

How much bigger did the development need to be to pay that $20 million? Twenty extra stories. It was too much: Millennium eventually cut the size of its proposed tower down to 49 stories while a citizen's review committee could barely drum up support for 15 to 30. The difference between the two was unbridgeable.

While all this was going on, a study group appointed by the city and the Turnpike just last year released a planning document called "A Civic Vision." It enthusiastically urged development over the air rights in order to "heal the physical, social and economic breach caused by the Turnpike's passage through Boston."

Nice words, to be sure. Yet given the collapse of Millennium's proposal and the Turnpike's obstinacy, the Civic Vision seemed doomed to do little more than collect dust - another in a long line of planning documents that are more wishful than practical.

But now recent events involving another project, proposed by Cassin/Winn Development Company, gives some cause for optimism.

This project, to be located on three parcels of the Pike bounded by Bay Village and the South End, is a mixture of hotel, office, commercial and residential space. Cassin/Winn's original proposal was eerily similar to Millennium's disastrous approach. The developer wanted to build two towers, one 38 stories, a second 33. Given that the surrounding neighborhoods are brick and brownstone buildings of five to six stories, it was like trying to put Michael Jordan's foot into a ballerina's shoe.

Yet the egos and economics of today are different. For one thing, Kerasiotes is gone. The new Turnpike is less driven by empire building and more focused on political accommodation. And unlike Millennium, Cassin/Winn was willing to rethink its plans.

In addition, the Pike backed off on its demand for rent premiums, now saying that it agreed with the planning guidelines of the Civic Vision.

Cassin/Winn thus came back with a much different plan. One of the two towers was gone. The shape of the project began to look more sensible as well: interstitial instead of transforming. On two of the three parcels, residential units would largely mirror the already built residential units of the two neighborhoods. Even the remaining tower, which is near Copley Place, would step down in height as it approached Columbus Avenue in the South End.

The project is beginning to look a lot like the ideas contained in the Civic Vision. Rather than an impasse between the developer and the citizens advisory committee that is reviewing the project, it increasingly appears as if a reasonable deal can be struck.

And that should be cause for celebration.

If the Cassin/Winn project proceeds, it will be a boon for the South End and Bay Village, knitting together two sundered neighborhoods. Moreover, it can serve as a model for other parcels over the Pike, showing that ego and economics can work to promote rather than obstruct development over the Pike. Who knows? Perhaps the Civic Vision's dreams may someday become a concrete and steel reality.