Behind Boston's surging wave of new luxury apartments
Here’s the question developers of luxury apartment buildings in Boston are asking: If we built it, will they come?
Over the next three years, nearly 10,000 upscale apartments and condos are expected to open in Boston, testing the city’s appetite for high-end living with a record level of construction.
Already tenants and buyers are showing a strong demand for high-end living in the Downtown area. For example, The Kensington, the 381-unit tower in Chinatown opened last fall, and it is nearly 50 percent full, while developer Gerding Edlen, has leased one quarter of the 202 units at the “315 on A” high rise. And at the 15-story Millennium Place condos in Downtown Crossing, only five of 256 condos have yet to sell.
Travis D’Amato, a senior vice president atJones Lang LaSalle who sells multifamily properties, said there could be some softness in the market in 2015, given the number of units expected to open that year. But overall, he’s bullish about the demand for luxury units.
“There will be some scratching and clawing for tenants, but we are seeing a significant increase in demand for downtown housing,” D’Amato said. “While it may seem like a very large increase to the luxury stock, it’s not a large increase as a percentage of rental housing in the city of Boston.”
But not everyone is convinced there are enough well-heeled tenants to fill $3,000 per month apartments. If the skeptics are right, it won’t be the first time Boston overbuilt one property type. As Harold Brown, the octogenarian developer and landlord, puts it: “The glut will bring rents down, and some developers and banks will lose money.”
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