The Real Reporter, September 23, 2016
Author: Joe Clements
Full Article: https://www.therealreporter.com/
DEDHAM—The sow’s ear turned into a silk purse here at 100 Rustcraft Rd. by Davis Cos. is being traded to another hometown investor via Newmark, the winning bidder being R.J. Kelly Co. of Burlington who reportedly will pay over three times what the slimmed-down 422,000-sf flex property went for in March 2013 when it fetched a mere $21 million. Back then, the asset was struggling at 41 percent occupancy and against a still shaky economic climate, conditions enabling Davis Cos. to buy at a deep discount—under $45 per sf on 480,000 sf—and spend necessary capital to resign a key tenant and land another critical requirement pushing occupancy past 95 percent, reports Davis Cos. asset manager Cappy F. Daume. She also confirms the sales agreement in place with R.J. Kelly.
“We are under contract and looking forward to closing by the end of the month,” Daume tells Real Reporter while declining to identify the buyer or pricing results when 100 Rustcraft Rd. was first pitched in April which had Real Estate Alert pegging the target allocation at $70 million, or a healthy $166 per sf. Observers spoken to could not say whether that level will be reached, but some maintain the expectations were what one describes as “in the ballpark” of that level, and if so, would seem to represent another Davis Cos. makeover for a platform concentrated in southern New England yet extended across the country. Daume herself was on the fly literally when spoken to, headed to catch a Chicago flight, but did have time to praise leasing and management professionals inhouse and the brokers involved for accomplishing what some considered an overly ambitious undertaken considering the uncertain times and weak market metrics, each since been erased in the robust Route 128 realm that aided in the building’s rebirth.
“It is very stable today,” Daume says, even more admirable given an initial proposal to lease the town of Dedham 200,000 sf for administrative purposes was thwarted by local voters at the last minute. The setback was soon forgotten, however, when now-Newmark broker Michael Frisoli succeeded in attracting General Dynamics for 133,000 sf and American Red Cross stayed put in a downsized commitment which provided further in-place cash flow, those two of three six-figure pacts in the mix with terms extending for 10 years.
“It’s an exciting story,” Daume says. As to the figure Davis Cos. will reel in from the sale, she would only offer that “it’s a good number,” referring other matters regarding the pending sale to Newmark’s Capital Markets team led by Robert E. Griffin Jr. plus Edward C. Maher Jr. and Matthew E. Pullen. Calls to that company were not returned by press deadline.
Also not responding were R.J. Kelly President and CEO Brandon Kelly, part of the family owned construction and investment firm whose other principals include namesake Richard J. Kelly and Brandon Kelly’s brother, Scott Kelly. The company has been on a buying spree this decade, most recently purchasing 326 Ballardvale Rd. in Wilmington and 10 Maguire Rd. in Lexington.
Davis Cos. has also been active on the acquisition front, that company led by namesake and founder Jonathan G. Davis, President Richard McCready and Managing Director Quentin Reynolds, responsible for originating, underwriting, closing and monitoring investments.