Brewery To Open This Summer in Downtown Springfield

Loophole Brewing, which bought the former home of the Pioneer Valley Brew Pub, is expected to open in July 2023, according to a MassLive article.The venue will offer beers brewed there as well as by other brewers, pub fare, and live music.

Polar Park Project - The Real Cost

The original price tag on the Polar Park project was $80-90 million, but the actual cost wound up being $160 million, and rather than bringing in new money to the city, it appears it will create a deficit of $40-60 million, according to economists' estimates.A MassLive article explains that the study, conducted by the College of the Holy Cross in Worcester and Kennesaw State University of Georgia, finds that sports stadiums in general do not generate substantial economic benefits to their host communities, and Polar Park is no different. The study also looked at Truist Park in Georgia, and came to similar conclusions.Proponents of sports stadiums say they will make the city more desirable and thus raise the city's revenues through increased property taxes.Another idea proponents float is that the parks will draw game attenders to restaurants, but in fact, most ticket holders eat and drink inside the stadium.Lastly, the study takes aim at promised new development around the stadiums. Worcester has seen big numbers of new and redeveloped residential units around Polar Park, but the authors say it's less than promised. How COVID fits into that is unclear.Worcester officials dispute the study and say the stadium has attracted visitors, residents and developers. Read the full article on MassLive here.

Retail Constraints - The Route 3A Conundrum

The stretch of road that connects Quincy and Weymouth - Route 3A - is an under-developed stretch of land in two booming communities. Why doesn't anyone seem to want to set up business there?A recent article in the Patriot Ledger (3A Development story - Patriot Ledger - 5-18-23), says the location (too close the water), current layout (small spaces that can't be expanded) and the fact that some seemingly-vacant businesses are actually used for storage are three reasons. 

South Shore Mall in Braintree May Add Apartments

As retail shopping changes, so-called “dead malls” across the country have been repurposed in numerous ways, including housing. Developments outside of New England have been largely for luxury units, but in New England, the emphasis has been on affordable housing.The Westminster Arcade in Providence was the first to be turned into housing. The first indoor shopping arcade in the US (built in 1828) fell victim to the 2008 recession. It had lovely architecture and held a fond place in the hearts of locals. So instead of demolishing it, clever developers turned it into 48 microunits (225-300 SF). It opened to renters in 2016 at a cost of $550 per month and in 2021 the affordable apartments were turned into tiny condos, starting at $125,000 to purchase.The Westlake Shopping Center, which opened in the 1950s in Daly City, California, is one of the first generation of shopping malls. The big box, anchor retailers in the mall did poorly in the pandemic, and in 2023 the owners announced that two former anchor stores – a closed Burlington Coat Factory and a portion of a parking lot – would be turned into 400 apartments. There will still be retailers in the mall, and the owners hope the residents nearby will shop at the local stores. Owner Kimco Realty has experience redeveloping malls, having completed the Witmer, a 26 story, 440 unit luxury apartment building adjacent to the Pentagon Centre mall in Arlington, VA. That development did so well, they developed a second, 11 story, 253 unit on the other side of the mall.Outside of Chicago, the large Westfield Old Orchard mall recently announced they are totally revamping their property with a vacant Bloomingdale’s being demolished to build “hundreds” of residential units, a vacant Lord & Taylor’s being demolished to create a farmer’s market and park, and numerous other storefronts being revamped into upscale dining and boutique shops. Construction is expected to be completed in 2026.The Urban Land Institute (ULI) reports that “retail-to-residential conversions seem to be leading the way” for adaptive reuse of closed malls. Residential reuse is attractive to investors, as buying those malls was expensive to being with, and it’s a sustainable use of an already-developed parcel, leaving green space free. The ULI article lists about a dozen mall to residential redevelopments across the country.One of the newest proposed is at the South Shore Plaza in Braintree. Developers ZOM Living has proposed a 495 apartments (315 for the general public and 180 restricted to seniors) on a nine-acre parcel that contains parking lots and wooded area already zoned residential at the back of the plaza. If the deal goes through, the parcel will sell for $20 million, according to a recent Globe article. The development would be called “The Residences on Granite”. The zoning application began in May 2023, and if approved, construction would start in summer of 2024.The Globe article cites an opponent from the North Braintree Civic Association, who states the project seems too large and that it would generate too much traffic. However, the town’s Master Plan and the South Shore Chamber’s 2030 Housing Initiative both acknowledge the need for more housing and it sounds like councilors are supportive.

Massive Wealth Transfer Underway

Have you ever wondered who can possibly be buying residential real estate as the price of single family homes across Massachusetts soars?Turns out, rich Baby Boomers are giving their younger relatives lots of money now, while they are still alive.  The New YorkTimes reports on the massive wealth transfer that is underway. The "giving while living" trend has resulted in the wealthiest Americans transferring large amounts of their wealth to their offspring so that the offspring can buy houses, boats, investment properties, etc. while they are still relatively young. Many of these millennials have always had access to money, as trust funds were set up for them from birth. So-called "trustafarians" (artsy, hipster types who work as baristas - if they work at all - and manage to live in million dollar housing) are often the ones snapping up real estate in desirable areas.This is happening among the top ten percent of households.Even lower-income families are seeing some wealth transfer to younger people, especially as housing values soar. Those families that own real property (especially if they own it outright with no mortgage) have seen their net worth increase; the same is true for people with stock investments. These parents can help with a down payment on a house or buy their kids a car, all of which helps the next generation have a sound financial footing.For the really wealthy, however, there are huge tax benefits to transferring this wealth to their younger heirs - individuals can transmit $12.9 million and married couples can transmit $26 million to their heirs without federal estate tax kicking in. There are also huge benefits to having wealth held in equities and stock. Middle-class people whose wealth is primarily the equity in their home "pay a wealth tax," according to the Times, by way of property taxes.As the Times article states, "legally approved forms of tax avoidance are the major tool of wealth preservation."Wh

Home sales declined across the country in April 2023, including Boston

Yahoo Finance reports that "homeowners are quiet quitting" the sales market, as they hold on to their lower interest rate mortgages and listings are down more than 20% compared to April of 2022. Inventory is low, mortgage rates are high, and only those with the ability to handle a 7% mortgage rate (or wealthy enough to pay cash) are buying homes right now.This is the case in Boston, too. The Boston Globe reports that "prices, sales volume, and new listings have all declined during what is typically one of the busiest months of the year."While the market in Boston is segmented on an almost street-by-street basis, overall, the median price for a single-family home in Greater Boston fell by 3% compared to the previous year and condos fell by about 1%.The Globe article notes that most homeowners have a mortgage rate between 2-3%, which is less than half the current rate and can result in about $1,000 more per monthly payment."Buyers still outnumber sellers" in many Mass towns, "but bidding wars are much more rare."

First they came for our cigarette lighters, then they came for our AM radio

Several major automakers have stopped offering AM radio in their new electric vehicles, according to an article in the Washington Post, which predicts this will be the death blow to many of the country's 4,000 or so AM stations. Ford is eliminating it from all vehicles.BMW, Mazda, Tesla, and VW say the reason they're removing AM is due to the interference from the engine to the sound of AM radio.The article in the Post says that over 82 million Americans listen to AM stations each month and half of all AM radio listening happens in cars. Many weather stations broadcast over AM - crucial in tornado-prone areas and other emergencies. So it may be a public service to keep AM radio alive. Mitsubishi, Nissan, Subaru, Toyota, Honda, Hyundai, Kia, and Jaguar Land Rover say they have no plans to eliminate AM.

Americans are keeping their old cars (not just for the AM radios)

It will be no surprise to most people that Americans can't afford new cars and are keeping their old cars on the road for longer - not because the cars are so great, but because they can't afford new ones.The Boston Globe said the old-car-keeping trend started during the pandemic, when new car parts were unavailable and used cars were commanding record prices, especially for those people who'd moved out of dense urban areas served by public transit and found themselves in less-dense settings were a car was de rigeur.The average age of vehicles on the road in the US has been steadily climbing, but surged upwards during the pandemic, as it did after the economic crisis of 2008, as this chart shows: The rising cost of borrowing has many not wishing to (and not be able to) afford a vehicle loan and the rising cost of everything that is making life unaffordable overall.

Chicopee Walmart in Trouble for Trash and Crime

The Walmart on Memorial Drive in Chicopee, which is the chain's second-busiest store, according to an article by Jeanette DeForge on MassLive, is not being a good neighbor.There is overflowing trash and frequent police activity. Neighbors say it has been this way for 15 years. The store applied for a permit to build a 6,315 SF addition to the building and Chicopee residents came out to protest the expansion and complain about current conditions.The meeting was continued for six weeks to give the retailer a chance to get the place in better shape.

Matta-plan

The Boston Planning and Development Agency (BPDA) recently released a detailed report with zoning and planning recommendations for Mattapan, as part of the sweeping "Imagine Boston 2030" planning revision. The BPDA vision for Mattapan encompasses a neighborhood where “a resident can obtain all their basic needs and material wants within a 10-minute walk” according to the 93-page long PLAN: Mattapan document. The idea of being able to reach “all basic and material needs and wants” in just ten minutes is upping the ante on the idea of the “15 minute city” a current favorite concept of urban planners around the world. In the UK, the idea of the 15 minute city (15mC or FMC to the cognoscenti) is also paired with strong feelings about the urgent need to reverse climate change by reducing automotive emissions. City planners in Oxford (England) were shocked to find that there was vehement opposition to their proposal to create 15 minute zones, which severely limited where residents could and couldn't drive their cars. People driving outside of their allotted 15 minute radius would be fined 70 pounds (about $85) when driving outside of the allowed zones. Thousands of Oxford residents signed petitions protesting the enforced no-drive zones and the planners were simply astonished that residents felt their rights were being impinged upon and took to calling those opposed to the plan conspiracy theorists and "flat earthers".PLAN: Mattapan believes that the way to reach the 10 minute walkability goal is to implement significant zoning changes, including allowing more business development in residential neighborhoods (outside of the Mattapan Square area where business is now concentrated and also by adding residential development in the Square).The proposed zoning changes will also allow ADUs by right, encourage microunits, and expand multi-family zoning throughout the neighborhood, especially around transit hubs, which supports the walkability goal.One such development has already happened. The Loop at Mattapan Station, built on a former parking lot, opened in April 2023. It contains 135 affordable apartments, all of which are reserved for households earning less than the area median income (which is $112,150 for a family of four). The Loop at Mattapan Station also contains 10,000 SF of storefront retail and a 2,000 SF fitness room for residents. There are plans, according to the Globe to build a second building with nine affordable condo units.PLAN: Mattapan touts itself as having been created with significant community input, unlike the top-down Oxford 15 minute zones. Mattapan residents have often felt left out and left behind when it comes to businesses and infrastructure. “Greater Mattapan didn’t get to where it is overnight,’’ said Fatima Ali-Salaam, chair of the Greater Mattapan Neighborhood Council in a Globe article. “It’s a buildup of decades of neglect.’’ PLAN: Mattapan envisions an urban planner’s utopia – ample bike and pedestrian access, abundant public transit (by extending the Mattapan T line into Readville and electrifying the Fairmount Line, plus increasing bus traffic), more open space, larger front setbacks for new development, and trees planted along the sidewalks. It has a vision “to proactively shape development and investment” and prioritizes small local businesses over national chains.Many of the zoning changes are in effect in other Boston neighborhoods and sub-neighborhoods, such as Neighborhood Shopping (NS) and Multi-Family Residential (MFR) zones, that allow increased residential and business density along key neighborhood corridors.The plan goes into very minute details of how to improve Mattapan, such as by hanging public banners that “honor and affirm residents’ cultural identity”.                     The BPDA is going through the same process in other neighborhoods in the city and we can expect more planning and zoning changes in the next few years. The last time the city's zoning laws were revised (city-wide) was 50 years ago and the "Imagine Boston 2030" initiative is an attempt to bring the city's planning and zoning regulations into the 21st century.

Former Boston Athletic Club Among Buildings in Proposed Redevelopment of 8 Acres in South Boston

Catherine Carlock of the Boston Globe reports that Oxford Properties and Pappas Enterprises have submitted a letter of intent to the City of Boston for a massive mixed-use development in South Boston. Their combined business will be called OxP.The proposal is for the transformation of an eight-acre parcel along West First Street and Pappas Way, within the 42-acre Pappas Commerce Park. The completed project would have 1.7 million square feet of “commercial and employment-based opportunities with a portion of residential housing that responds to the neighborhood” over seven buildings.Pappas Enterprises has controlled much of the 42 acre industrial park since the 1960s. The vision for this project is a long-term one, as some of the leases on the properties in the proposal don't expire for another 15 years. If approved, the plan is for the work to be done in stages..

16 apartments coming to Chicopee

The Chicopee City Council approved preliminary plans for a 16 unit apartment building on the site of a former Masonic Temple (more recently a thrift store) that burned down in 2017.The vote was 12-0 and while one resident spoke against adding apartments to the city, the council acknowledged that Chicopee, like the rest of Massachusetts, has a housing shortage.Read the full article on MassLive

Christmas Tree Shops Joins Ranks of Sinking Retailers

Diti Kohli of the Boston Globe wrote about the Christmas Tree Shops chain closing ten stores and filing for bankruptcy/restructuring in May 2023. The chain was established as a seasonal Christmas shop in Yarmouth about fifty years ago and grew to have locations throughout New England, selling cheap household goods and decorations year round.In-person shopping was flagging before COVID and is in more of a slump now, at least for over-saturated large retailers. Since 2020 other big box retailers that have filed for bankruptcy, significantly downsized, or closed completely include Bed Bath & Beyond, JC Penney, Sears, Macy’s and Lord & Taylor.

Mayor Wu's Rent Control Plan Modeled on Portland, OR

Rent Control is a government program that limits annual increases on rents, with an aim on keeping costs reasonable for tenants. Almost all rent control programs are municipality-based and exist in cities and towns in New York, New Jersey, California, Maryland and Washington, DC. In 2019, Oregon instituted a statewide rent control law, limiting annual rent increases to 7% + the consumer price index. Now that the CPI is high, that means rents can be raised by 14%, which is unaffordable to many tenants, particularly in the urban areas of the state, where rents are already higher than in suburban and rural areas. Portland, OR in particular has a significant homeless population and the increased rents are driving people to live in tents and their cars when they can’t afford the increases.The Boston Globe recently ran an article about the Oregon situation and interviewed a 70 year old woman who works and receives Social Security. Her rent for a basic, rent-stabilized, two-bedroom apartment in Portland is about to be raised to $1,400 and she can’t afford it. She is contemplating moving into her car.When the Oregon law was passed in 2019, the CPI was nowhere near the 7% it is today, and housing advocates didn’t foresee the increases getting so high. Landlords did, however, and warned that initial bill was a foot in the door for even stricter rent caps. This year, the Oregon Legislature is considering a lower cap: 3% plus CPI or no more than 8% annual increase, whichever is lower.Opponents to rent control say that what’s needed is simply more housing and that if there was more supply, demand would be sated and there would be price points for people all along the market. Landlords and developers say that limiting rents limits their profits, which limits what they have to invest in new housing.Median home prices in Portland Or have tripled since 2000 and there are now at least 5,200 people who are homeless, many sleeping rough in tents. It’s a scale of housing crisis that has not been seen in the Greater Boston area, perhaps because the median rents are so much higher in metro Boston. Many of those who can afford to live in Boston can afford the rental increases and those who can’t are still earning more than low and middle-income renters in Oregon. Perhaps some of the 100,000 people who left Boston moved West, where apartments are relatively affordable. The chart below shows the rent increases in the two cities over time, including when the rent control measure came into effect in Oregon. The Oregon housing bill that contained the rent restrictions also loosened zoning laws, allowing multi-families to be built on what were single-family lots and also allowing ADUs, which permit the owners of single-families to create rentable units in their backyards. Developers can also fit more units on one lot, even if they feel the rents they get can’t be raised as much as they’d like.Boston’s Mayor Wu is attempting to institute rent control in the city. Her plan would limit annual rent increases to 6% plus the CPI, but with a maximum hike of 10%. The first 15 years after construction would be exempt from the rent controls, just like in Oregon and small, owner-occupied apartments would be exempt. There are no zoning changes built in to the law she proposes. Boston housing advocates mostly support Wu’s proposal (some say it doesn’t go far enough), but the business community unsurprisingly does not, for all the same reasons given in Oregon: it will stifle growth, landlords and developers won’t be able to build, and the free market should set the rent. Developers and housing advocates agree that building more will naturally stabilize rents down-market. Some apartments are subject to bidding wars and there are certainly tenants out there who can and will pay top dollar for those pricey Boston apartments. But nearly every day there are news stories about working people leaving Boston because they can’t find a place to live that they can afford. The median per capita income in Metro Boston was $92,900 in 2022, according to the US Bureau of Economic Analysis, whereas in Metro Portland it was $68,374.The graph below shows what an annual increase on a $2,000 apartment would look like under various models of rent control:        Rents in Boston and Cambridge are the highest in the state, with a median asking price in the Back Bay/South End hitting $3,940 in the last quarter of 2021 (the most recent data available). Prices have undoubtedly risen since then, meaning many median rents are topping $4,000. But with a median per capita income of over $90,000, those rents are easily affordable for some.Pro-affordable housing critics of rent control say that because there are no income restrictions on rent controls, more affluent people will “scoop up” lower-cost units in order to benefit from limited rent increases. Economists warn, however, that rent controls can fuel gentrification “by driving up rents in uncontrolled units or pushing landlords to convert apartments into condos” Rent control in and of itself doesn’t seem to have an impact on production, according to experts. The lag in new development in Greater Boston is due to high interest rates, and rent controls probably won’t further depress production. But it also doesn’t create production. As quoted in the Globe,  rent control “doesn’t create an incentive to build, or make it easier to build,” said Jenny Schuetz, a senior fellow in urban economics at Brookings Metro. Building more housing is “the only solution” to the housing crisis, she said.

Haitian and Latin American Migrants Coming to Mass in Record Numbers

Economic and political turmoil in Haiti and Latin and Central America are resulting in a surge of migrants coming to Massachusetts and this influx of new people, many of whom do not speak English and are in need of shelter and medical and social services, is overwhelming shelters and service providers. 900 homeless families have been placed in hotels as emergency shelter and Governor Healey’s proposed FY24 budget includes $324 million for shelters, but that might not be enough, according to a Boston Globe article.

Inflation is coming down

You might not know it to look at your own household bills, but according to the Bureau of Labor Statistics’ April report, the Consumer Price Index (CPI) increased 4.9% since last April, a tenth of a percentage point lower than was predicted. The NY Times reports that inflation is starting to come down, which normally means lower prices for consumer goods such as food, clothing, energy, and appliances. Prices in some areas have fallen slightly, as the chart below shows, but others still rose, just at a slower pace than expected.

Water, Water, Everywhere

The Boston Metropolitan Area Planning Council (MAPC) recently released an analysis of locations that were impacted by severe flooding in March 2010, storms that resulted in several counties being designated as Federal Disaster Zones. The report shows that 96% of the FEMA disaster claims from the Greater Boston area were outside of FEMA flood zones.The Boston Globe analyzed the report and interviewed people impacted by the 2010 storm. People interviewed said that they were unprepared for the flooding and lost personal effects and mechanical systems in their basements from the groundwater seepage during the heavy rain.From 1971 to 2000, Massachusetts had an average of 7 days per year of “heavy rain” (meaning one inch or more) and by 2050, that annual average is expected to rise to 15-17 days. Despite being a state that borders the Atlantic Ocean, one of the biggest risks in the state is inland, where lakes, ponds, rivers and streams as well as under-capacitied stormwater systems, overflow and inundate roads and homes.Some indicators in the report that might predict a location that is at-risk for flooding (for properties that don’t lie within acknowledged flood zones) are being built between 1940 and 1980, flat elevations with sandy soils, and being near bodies of water or wetlands. Much of Boston is built on wetlands, so that’s bad news for the state’s capital.The MAPC analysis recommends that MA adopts regulations that require a property’s flood history be disclosed to potential buyers.

Bidding Wars for Apartments on the Green Line

The residential vacancy rate in Greater Boston is below 1%, meaning there are dozens of people (or more) vying for each apartment that becomes available.Boston.com reporter Jim Morrison recently posted a story about the rental bidding wars happening along the Green Line extension in Medford and Somerville. The article details an apartment (probably a one-bedroom, but it doesn’t say) that went on the market for $2,450 a month. 37 people came through for the showing, they accepted 11 applications and rented it to someone who bid $2,700 a month – 10% over the asking price.The article says that of 93 units rented in Medford in Feb – April, 10 went for over asking price and in Somerville, 51 units were rented with 7 for more than the asking price.The addition of the Green Line into Medford and Somerville is making them highly desirable for people who commute to jobs served by it. Some housing experts say the vacancy rate is too low and is contributing to the exodus of young people from Greater Boston.

Short-Term Rental Restrictions Fail on Nantucket - For Now

Nantucket's Town Meeting on May 6th considered a change to the zoning bylaw in order to regulate short-term rentals. This was the third time short-term rental regulation came before the voters at Town Meeting. The proposed rules (Article 60) would have restricted short-term rentals (STRs) to mainly accessory dwellings units (ADUs) in owner-occupied homes and for non-owner-occupied units the home would have to have been “used more often as a residence than an STR”. This would have allowed for long-term rentals in the same property (31 days and longer), or owner-residency for half the year and STRs for the other half of they year and would have prohibited “strictly commercial STR businesses in residential districts (i.e. no investor-owned properties that were rented exclusively as STRs).558 voted no on the article, with 378 voting yes, meaning 60% of the nearly 1,000 voters didn’t want the regulation. Zoning bylaw amendments require a 2/3 majority for approval.Those who support the change were mostly year-round residents who believe the large number of STRs is making it difficult for locals to find housing and that is “threatening our neighborhoods and local community”. That quote was from Emmy Kilvert, who sponsored the article.The successful opposition came from a coalition of the Nantucket Association of Real Estate Brokers (NAREB), Nantucket Together (a group of part-time residents who operate their homes as STRs when they’re not using them) and The Copley Group (an investment group that operates a dozen STRs), according to an in-depth article in the Nantucket Current.Several speakers wanted voters to wait until the town’s Short-Term Rental Working Group (appointed at the 2022 Town Meeting)  finishes its recommendations later this year and brings them to a Special Town Meeting in November. To these voters, it seemed like the Article 60 crowd were trying to do an end-run around the committee the town had chosen the previous year.The anti-Article 60 coalition presented testimony that “seasonal owners provide accommodations for 95% of our visitors in the summer and pay 80% of our property taxes” that according to Penny Dey, NAREB President. The proposed article “does not create affordable year-round housing, it does not make it less crowded here in the summer…houses are built to be occupied… a residential use is just that: a residential use, whether they’re here for a month or days,” she concluded.Those in favor of Article 60 disputed the economic argument, saying “Nantucket is a community, not a commodity. Every time a home turns into a strictly short-term rental business, that’s one less home for the labor and delivery nurse who’s delivery our Nantucket natives.” This was from Allyson Mitchell, who is currently the town’s housing and real estate office manager, but who previously was a Property Manager for the Copley Group, the real estate investment group that owns many STRs on the island.

Maybe Mass isn't heading for a recession after all?

Larry Edelman, business reporter for the Boston Globe recently wrote an article in his weekly newsletter opining that perhaps the news isn't all bad for the New England economy.He did a deep dive into the Fed's "Beige Book", which details housing and employment info and found nothing but stability. Retail prices rose modestly, retail sales were steady, commercial real estate was unchanged. The outlook, per the Fed, was "mostly positive". The one note of caution was on lending. There are worries that banks in New England will curtail lending after what happened in Silicon Valley and Switzerland. The market did take a pause in Q1 2023 as lending abated.