One of Boston’s busiest and best-known buildings is going on the market.
The company that operates South Station listed its long-term lease on the building for sale Wednesday, putting the retail concourse and four stories of office space above it into a hot real estate market where tenants and investors prize access to transit.
“South Station represents the combination of two of today’s most highly sought-after real estate investments: urban retail and creative office space,” said Coleman Benedict, senior managing director of HFF, a brokerage firm hired by Blackstone Group subsidiary Equity Office to market the property. “While many buildings are located near mass transit, very few actually sit directly on top of it.”
No minimum price was set, but real estate experts familiar with the offering say comparable deals suggest the lease, which has 98 years remaining, could fetch around $100 million. They expect strong interest both from large real estate owners and the sort of international investors who have flooded into Boston’s office market in recent years.
While the MBTA operates the tracks at South Station, the concourse and office space have long been privately run under a long-term lease with the state. Beacon Capital Partners redeveloped it in the 1980s, before merging with real estate giant Equity Office in 1997. Nearly a decade later, Blackstone bought Equity and has controlled the building since. The company has upgraded the retail offerings, adding a large CVS in 2013, and has leased nearly all the upstairs office space.
HFF said Blackstone hopes to have a buyer for the lease within a few months.
Whoever takes over South Station could be at the center of a boom. Houston-based developer Hines is set to start work soon on a 51-story tower atop the commuter rail platforms at the station. State transportation officials are also planning an expansion that would add seven more tracks, making South Station even busier.Tim Logan can be reached at firstname.lastname@example.org. Follow him on Twitter at @bytimlogan.