"The price tag alone shows we've made the city and the site an extremely desirable location to do business and to invest for the long-term," said Curtatone. "We believe the city is now poised to take off on the economic growth front."
Federal Realty, one of the nation's 30 largest real estate investment trusts, announced this morning it had purchased the Assembly Square mall and adjacent properties as well as the rights to develop the so-called Yard 21 parcel from Assembly Square Limited Partnership (ASLP). Federal was founded in 1962 and has a total market capitalization of more than $4 billion.
Curtatone noted the selling price for the 45 acres (Federal purchased 36 acres outright and the rights to develop an additional 9.4 acres) is testimony to the site's value and Somerville's growing clout in the region's real estate market. The parcels bought yesterday were a little less than one third of the total Assembly Square area, which means the overall value will be far greater than $64 million.
"After years of neglect, we're unlocking tremendous economic potential at this site," Curtatone said.
Curtatone said Federal is committed to overseeing the development of the new Main Street near the mall and the much larger "Yard 21" neighborhood near the Orange Line tracks. Experts have estimated the two phases of the project plus the adjacent IKEA, Inc. property will generate almost $10 million per year in new tax revenue for the city.
"This is a giant step forward for Somerville," said Curtatone. "This will help us expand our tax base right away while also jumpstarting economic development across East Somerville."
Curtatone credited ASLP for working with the city and community for more than four years to find enough common ground to get zoning approved and to develop a Yard 21 master plan.
"ASLP's persistent work with the city and community groups added great value to the project by making the zoning possible and by working to develop the Yard 21 master plan," Curtatone said.
Peter Merrigan, President and CEO of Taurus Investment Holdings, one of the ASLP partners, said he "was proud that, in cooperation with the Mayor and other elected officials, we were able to unlock what will be ultimately be a $1 billion investment in the City of Somerville."
Curtatone said Federal was the right company for the job ahead because they have both the expertise and the long-term, patient capital to take the project to the next level.
"Because Federal is one of the few companies in the country with experience in transforming underutilized sites into mixed-use, urban villages, they are an ideal partner for the next phase," Curtatone explained.
Federal Realty Investment Trust owns and operates high-quality retail assets, including shopping centers and urban mixed-use redevelopment business across the country. The company has planned and coordinated Bethesda Row, Maryland, Santana Row, San Jose, California, and Pentagon Row in Arlington, Virginia, three of the most successful mixed-use projects in the country. It is currently developing mixed-use sites in Rockville, Maryland and Arlington, Virginia. (For more information on the company's mixed-use developments, go to the company's website.)
Federal President and Chief Executive Officer Don Wood praised Curtatone and the Board of Aldermen for clearing the way for development in the area.
"Having the zoning in place made this a very attractive property," said Wood. "We're committed to Somerville's vision of creating a true, mixed-use neighborhood with public transportation, green space, and dynamic streetscapes."
According to Federal executives, the Assembly Square purchase is part of its effort to expand its presence in the Boston market. It currently owns retail sites in Saugus, Dedham, Norwell, North Reading, Weymouth, Carver, and Bridgewater.
"We have been expanding rapidly in the Boston area but Assembly Square will be our focus for the next several years," said Wood. "With its proximity to Boston and with a city committed to making things happen, this site has incredible potential."
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