David Simon had had enough.
It was fall 2016, and the CEO of Simon Property Group — the largest owner of shopping malls in the US — had spent nearly a decade trying to build a skyscraper at Copley Place. Developing a 52-story tower in Boston’s Back Bay is complex under the best of circumstances, and this one was made far more complicated by its proposed location: On a deck above the Massachusetts Turnpike, with tens of thousands of cars a day whizzing underneath. The safety and engineering review was endless. Eventually, Simon pulled the plug.
“We are excellent project managers and had obtained 14 out of the 15 required approvals needed to proceed with the tower and expected to get the last one,” Simon told analysts on a conference call a few weeks later. “Unfortunately, the goalpost kept moving.”
It was the latest in a long string of failed plans to build so-called “air rights” projects above the Pike. And Simon’s words served as a wake-up call to Governor Charlie Baker’s administration, said Scott Bosworth, undersecretary and chief strategy officer at MassDOT.
“Simon had some very critical points they made, and our answer to the governor was: They’re right. We’re not a great partner on these things,” Bosworth said. “That changed everything. It changed our focus and our drive to get this done.”
MassDOT has since streamlined the intensive review process and devoted more attention to pushing these projects — which sit atop some of the most valuable pieces of undeveloped “land” left in Boston — across the finish line. Today some of the largest projects underway in Boston are towers rising over the Pike along Massachusetts Avenue and near Fenway Park, as well as over a submerged portion in the Seaport. At South Station, a long-planned skyscraper is finally underway over the railhead where thousands board commuter rail trains daily. More are in the works.
The failed Simon project at Copley Place was one wake-up call. But last month the Baker administration got a wake-up call of a different kind, when inspectors found a severely deteriorated support beam for a different, and far older, type of air rights project: the Government Center Garage. Inspectors discovered the beam, deteriorated by decades of water damage, below ground in a shuttered part of Haymarket station. Service on the Orange and Green lines was halted immediately, and only resumed after a weekend’s worth of emergency work to shore up the beam with steel bracing. (The reason the inspectors were even in the tunnel to begin with was to study its structural integrity following an accident above in March, when a portion of the garage collapsed during demolition, killing a worker and halting T service for several days.)
The episode shows how rapidly circumstances can change with these complicated mega-projects — derailing not just construction of a building, but vital public needs, like roads and trains — and how complex agreements about how to maintain private infrastructure in public space can blur over the decades. And all of it comes at a time when the city is desperate to have workers return to the office and bring vitality and life back to downtown.
In dueling statements issued as outrage spread over the latest T shutdown, both the MBTA and the HYM Investment Group, which owns and is redeveloping the Government Center Garage, essentially blamed the other. HYM and general contractor John Moriarty & Associates later said they’re “not in the business of pointing fingers,” but also made sure to note that “these tunnels are inaccessible without the permission of the MBTA.” Meanwhile T officials sent reporters copies of a typewritten easement, drafted in 1966 with the then-Boston Redevelopment Authority, outlining how whoever owned the hulking garage would be responsible for maintaining the support columns that slice through the T station below.
Questions about who is ultimately at fault could take years to settle in court, one expert said. But either way, as prime plots of developable land in Boston dwindle, real estate experts expect more major projects will be built atop highways and rail stations — which means grappling with complicated questions of economics and engineering, not to mention multiple public agencies.
These projects are phenomenally expensive, upping the risk to investors and often limiting the range of uses to those that command the highest rent. These days that usually means lab space.
As developer John Rosenthal searched for partners to help finance the $1 billion second phase of his long-planned Fenway Center air rights project, he found life science developers were most receptive. So he pivoted away from a previously approved plan for residential to incorporate lab space instead, and reached a deal with developer IQHQ — a California-based firm that by late 2020 had raised $2.4 billion to finance lab projects nationwide — to launch construction. Those deep pockets meant IQHQ could take on a challenge.
“Not a lot of investors are willing to invest over $1 billion,” Rosenthal said, “and [then wait] 4½ years to complete a project to start to get a return.”
Altogether, it’s a challenge that has bedeviled Boston developers for decades.
Failures have been epic, ranging from Columbus Center over the Pike along Clarendon Street — whose prominent developer Arthur Winn ultimately pled guilty to illegal campaign contributions — to so-called Parcel 15, near the Hynes Convention Center, which ended in ugly lawsuits between former business partners John Fish and Stephen Weiner after the project fell through.
But lately there have been successes, too.
Samuels & Associates recently celebrated completion of a deck over the Pike along Mass. Ave., which will eventually house the headquarters of CarGurus, a park, and a hotel. The public-private partnership was also much touted, and Baker noted the “incredible feat of engineering” necessary to build over a highway and train tracks which have to operate day and night.
And a mile down the Pike sits Fenway Center, where work is now underway on a 2-acre deck that will span the eight highway lanes below.
Crews have spent the past year drilling hundreds of concrete and steel support beams, called piles, into bedrock to hold up the deck, which will in turn hold up the tens of thousands of tons of building above.
There are mini piles that are encased in concrete between the highway and the railroad tracks, and larger steel H piles drilled between 230 and 270 feet deep into the ground below. Each pile is capped with 75,000 pounds of steel and stretches about 700 feet, Rosenthal said. Much of this work happens late at night, to prevent commuting disruptions.
The deck alone will cost about $200 million, Rosenthal said, and there’s another $55 million in upfront rent to the state. The construction cost includes not just Rosenthal’s engineers, designers, and consultants but the army of experts employed by MassDOT and MBTA to monitor the project as well. When it’s done, the state will technically own the project site — Rosenthal’s team has a 99-year lease — and therefore must approve every plan and document.
“That’s like the seller having an ongoing interest in your property — which they do — and therefore it doubles all of your legal, your engineering, your design” costs, Rosenthal said. “It’s just another example of why air rights are so difficult to do, so expensive to develop. ... We paid $55 million for air.”
Mitigating risk and ensuring public safety is always top of mind on any construction project, and especially for projects where a fallen beam or errant tool could land on roads or train lines below, experts from the Wentworth Institute of Technology told the Globe.
“The care that has to be taken during [the] construction process is really of extreme importance, and that becomes very, very challenging,” said Ilyas Bhatti, a professor of construction management at Wentworth. “There are risks involved, and the challenge is: How do you mitigate those risks?”
And construction is only the beginning of a relationship between developers and public agencies that can last decades, noted Wentworth civil engineering professor Jim Lambrechts.
“After the project’s done, the risk then becomes the continued longevity, the continued structural integrity of the structure you’ve built,” Lambrechts said. “Who inspects it? Who takes care of it?”
And as the brouhaha over Haymarket and its ailing beam shows, those questions can last for a long, long time.