by Neil W. McCabe

Lt. Gov. Kerry M. Healy joined Mayor Joseph A. Curtatone for at a March 2 press conference to announce the $64 million sale of several key Assembly Square development parcels to Federal Realty Investment Trust of Rockville, Md.

“This is a landmark deal for Somerville and a major step forward in the city’s economic growth effort,” the mayor said. 

“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.” 

The mayor said one reason he chose to have the press conference on the former Liberty Mutual offices overlooking the development was to illustrate the end of vacancies that had plagued Assembly Square. 

Then, gesturing out the windows, he said the other reason was get the point across the vast potential of the last great development site in the Boston-area.

The mayor said if the lieutenant governor waited long enough, she would see an MBTA Orange Line train go by, and maybe one day she could see one slow down and stop at the new Assembly Square T-stop.

“That was a great exercise in visualization,” said Healy to Curtatone, after she took in the view from the podium.

Healy said she was grateful for the determination of the mayor and city’s aldermen to create the conditions for smart development of the Assembly Square.

The mayor’s plans for the project are consistent with Governor Mitt Romney’s goal to revitalize the state’s city centers with the housing and jobs that make communities vital, Healy said.

Speaking after Healy, Board of Alderman President Bruce M. Desmond said he was getting used to seeing the lieutenant governor, referring to her attendance of the announcement of new funding to refurbish Dilboy Field and to signing of the home rule petition approving the anti-gang ordinance.
“Every time we see her it means something good is happening here,” Desmond said.

Federal Realty is a real estate investment trust, or REIT,  that trades on the New York Stock Exchange under the symbol: FRT.
The REIT 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, Curtatone said. Federal was founded in 1962 and has a total market capitalization of more than $4 billion.   

Curtatone said the selling price for the 45 acres, of which 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.

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, Curtatone said.

“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.”

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,” he said.

“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,” he said.

“Having the zoning in place made this a very attractive property. We’re committed to Somerville’s vision of creating a true, mixed-use neighborhood with public transportation, green space, and dynamic streetscapes,” Donald C. Wood, the REIT’s chief executive.

Wood said he praised Curtatone and the Board of Aldermen for clearing the way for development in the area. 

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, he said.

“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.” 

Wood said his company was embarking on an ambitious construction schedule to have the shopping mall fully operational and open by Christmas.