It's not the place you want to go dressed in ripped jeans and a stained T-shirt - not with places like the Armani Café and stores like Kate Spade Shoes and Burberry's Limited lining the brick sidewalks. One of the latest deals there proves that Boston's Newbury Street isn't for bargain hunters - in fashion or in real estate.
A retail office building at 349 and 351 Newbury St., anchored by Hold Everything, a Williams-Sonoma company, has garnered Newbury Street's biggest price tag in more than a decade - $7.45 million. That figure equates to about $372 per square foot paid to SMC Management by Copley Investments to acquire the prize, a price tag that commands a jaw-dropping response, particularly at a time when commercial real estate is suffering through a prolonged slump and tenants are tough to come by.
In this land of designer duds, however, landlords can turn up their noses at tenants seeking a cut-rate deal. Isolated from the overall market slump, Newbury Street boasts a vacancy rate of just 7 percent.
Douglas J. Marr, senior vice president of Keliher Real Estate - the man behind the decade's largest sale on the city's most trendy thoroughfare - said the fall is his busiest season. Just recently, he brokered a 3,300-square-foot lease on Newbury Street for the Lawrence Martin Gallery, helped find 1,500 square feet at 166 Newbury St. for Lush, a British women's cosmetic company, and secured a spot at 251 Newbury St. for Window Treats.
All the activity has eased much of the apprehension that cropped up last year, when vacancy rates along what's been dubbed the "Rodeo Drive" of the East Coast rose slightly.
Renting aside, Marr said it's a big year for retail investment properties. Between the benefits of the IRS 1031 Exchange program - which allows a property investor to defer the capital gains tax they would otherwise pay in a sale - and the low interest rates, Newbury Street is once more a hot spot for investors.
"It's the wild, wild West out there with regard to income properties," he said. "There are very few out there that are available. People who got smacked in the stock market would rather buy brick and mortar," Marr said.
Published: August 25 2003
