AREA JV to develop Boston office property

The 500,000-square-foot development at One Channel Center is expected to cost roughly $225 million. Financial services firm State Street has agreed to occupy the entire property.

AREA Property Partners is teaming up with Commonwealth Ventures to develop an 11-story, 500,000-square-foot Class A office property in Boston. 

A statement from AREA reveals that the venture is proceeding with development of One Channel Center following the Boston Redevelopment Authority’s recent approval of the project. One Channel Center is 100 percent pre-leased to State Street, which has agreed to occupy the property for 15 years. 

One Channel Center will be built on the last remaining development site in the Channel Center project, in close proximity to the seaport. According to local media reports, the new building located just off of A Street will cost approximately $225 million and is scheduled to be completed by February 2014. In addition to office space, One Channel Center incorporates a 980-space parking garage. 

Lee Neibart, global chief executive officer of AREA, said in the statement that he believes “One Channel Center is the right project, in the right place, at the right time.” 

Richard Galvin, president and founder of Commonwealth Ventures, added: “Now that we’ve assembled all of the key government approvals, development expertise and capital to bring this project to successful completion, we look forward to breaking ground.” 

AREA confirmed that it is providing the bulk of the equity capital for the project. That investment is being made through the firm’s current US opportunity fund AREA Real Estate Opportunity Fund VI, which closed on $519 million in June 2011. The deal was sourced through AREA’s previous role in another Channel Center project.