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The COVID-19 pandemic is clobbering apartment rents, especially in student-heavy neighborhoods in and around Boston.

One big new apartment building in the Fenway is breaking ground anyway.

Development firm Scape North America closed this week on a $165 million construction loan and plans to start work by the end of November on its 451-unit building on Boylston Street, near Fenway Park. It’s the first large apartment building anywhere in Boston to launch work since the pandemic hit in March.

The $230 million project has been in the works for several years, and is the first of three apartment buildings the developer — which launched here planning student housing but shifted to build more general-purpose apartments — has planned in the Fenway. It won city approvals in January. Scape’s ability to find a lender at a time when financing for apartment buildings has grown scarce speaks to the strength of the neighborhood and Boston’s life science industry, said CEO Andrew Flynn.

“It really represents a testament from capital markets in their confidence in the expanding medical hub of Longwood, and the rapidly expanding life science industry in the Fenway,” Flynn said.

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The project is being financed by Madison Realty Capital, a New York-based investment firm that’s also funding the Raffles Back Bay Hotel & Residences now under construction off Stuart Street. The private-equity-backed firm has made several large construction loans in recent months. Madison said it likes this project’s proximity to job centers such as Longwood.

Still, rents have fallen sharply in Boston as the pandemic has dampened demand from both students and young professionals. The median apartment rent has plunged 16 percent compared with November 2019, according to real estate website ApartmentList, and thousands more units remain under construction around the city, set to open over the next year.

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Breaking ground now, the Scape project would be further out in the pipeline; Flynn projects an opening in late 2022. He and his investors — which include Madison as well as Boston-based equity partners — are betting that’s far enough in the future that demand will recover, particularly in a place like the Fenway where a wave of new commercial development aimed at life science companies is likely to draw workers who’ll need someplace to live.

“Boston has experienced significant growth in the areas of life sciences, health care, and technology, and this financing will ensure that workers in these sectors will have access to much-needed, reasonably priced housing options in the highly sought-after Fenway neighborhood,” said Madison managing principal Josh Zegen. “We look forward to working ... on an important project in the Boston area.”


Tim Logan can be reached at timothy.logan@globe.com. Follow him on Twitter at @bytimlogan.