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A 510,000-square-foot lease by State Street Corp. will anchor a $900 million office tower at Bulfinch Crossing, the 2.9-million-square-foot redevelopment of Boston’s Government Center garage property.
The financial services giant will occupy 22 floors on the lower half of the 43-story skyscraper designed by Pelli Clarke Pelli Architects. Vertical construction will begin in May, following demolition of the exit ramps on the northern end of the parking garage next month, said Thomas O’Brien, managing director for Boston-based developer HYM Investment Group.
State Street’s lease leaves approximately 500,000 square feet available on the upper floors of the tapered glass office tower. O’Brien said the remaining space likely will be offered to multiple tenants. He declined to give a specific range of asking rents but said they’ll be among the top of the market for Boston office space.
Lease negotiations began with State Street in December, O’Brien said, following a request for proposals issued by State Street Corp. more than a year ago. CBRE represented both parties.
“They knew from the beginning they had to start early and be well-organized, and they ran a very good process,” O’Brien said.
State Street Corp.’s lease expires at the end of 2022 at One Lincoln, the office tower near South Station that bears its name and serves as its global headquarters. That building was completed in 2003. The Bulfinch Crossing deal doesn’t affect State Street’s occupancy of its 501,000-square-foot One Channel Center offices in the Seaport District, the company said.
Bulfinch Crossing’s transit-friendly location next to the MBTA’s Haymarket station and three blocks from North Station may have played into State Street’s decision, said Brendan Carroll, director of intelligence for Perry Brokerage Assoc.
“Our statistics suggest that the Green and Orange line combination reaches densely populated areas with very talented people,” Carroll said. “From a transit standpoint, they can draw from lots of the region and people who consider it to be an easy car-free commute.”
Office tenants have since 2012 leased 15.2 million square feet within a half-mile of an MBTA rapid transit station, or 64 percent of all leasing activity in that period, according to Perry Brokerage research.
HYM originally partnered with National Real Estate Advisors on the project and brought in an additional equity investor last fall in Washington, D.C.-based Carr Properties.
Bulfinch Crossing includes a 45-story condominium and apartment tower which is scheduled to open its first units in spring 2020. The site’s east parcel faces the Rose Fitzgerald Kennedy Greenway and has approvals for a hotel and condo building, mid-rise office building and retail building.
