Category Archives: Land Use & Development

Industry Groups Worry Massachusetts Climate Bill Could Derail Development

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Legislation would slash emissions by 50% of 1990 levels by the end of this decade

Written By: Scott Van Voorhis | This article was originally published in Engineering News Record on January 6, 2021

A sweeping and newly passed Massachusetts climate change bill could derail development projects and thwart construction as the battered economy struggles to regain its footing, industry groups warn.

NAIOP Massachusetts, which represents major commercial and residential developers, says the goals of the bill, which would slash emissions by 50% of 1990 levels by end of this decade, are laudable. The NextGen Roadmap bill even won praise from one of state’s largest business groups, Associated Industries of Massachusetts, as well as from environmental organizations.

“Overall, we were heartened when those commitments were made,” said Anastasia Nicolaou, Vice President of Policy and Public Affairs at NAIOP Massachusetts.

However, NAIOP Massachusetts, as well as the Greater Boston Real Estate Board, two groups that represent major developers and the many of the firms that work with them, say they have major reservations about a specific provision in the bill they contend would drive up construction costs and make development much costly and difficult.

In particular, a provision in the newly passed NextGen Roadmap bill would enable individual cities, towns and suburbs to mandate tough, net-zero-energy building codes could hurt construction and development at a time when the economy remains shaky, they say.

The rules are needed because “projects and buildings municipalities approve for construction this year will still be up and going strong in 2050, when the entire economy of Massachusetts, in all its aspects, must put out “net zero” emissions,” said State Sen. Mike Barrett and Rep. Thomas Golden, both Democrats and the chairs of the Legislature’s climate change committee, in a statement. “So we give the force of law to the creation of a ‘net zero stretch energy code’.”

Yet for developers, achieving net-zero emissions in new office or other commercial buildings is “rarely achievable,” especially when it comes to structures more than 10 stories, Nicolaou of NAIOP Massachusetts contends.

While some legislators have argued that a wave of new solar-power construction could help make net-zero a reality, Nicolaou is skeptical there is currently enough clean energy to fulfill demand.

“Carbon reduction is increasingly important – we just need to ensure we get there in a practical and feasible way,” she said.

The goal could drive up construction and maintenance costs, seriously undermining the feasibility of large-scale commercial or residential projects.

“Net zero increases the cost of construction … current rents would not be able to cover the increases,” Nicolaou said. “It could have the effect of driving our innovation economy right out of the state.”

Meanwhile, the relatively broad and ambiguous wording of the net-zero energy provision also has the potential to cast a large degree of uncertainty over development projects currently under review by local officials, or getting ready to start the review process, Nicolaou said.

The bill leaves it up to the state Dept. of Energy Resources to develop the new, net-zero energy stretch code, which could then be adopted by individual communities.

But as it stands now, there is no definition yet of what net-zero energy will mean in practical terms, or to what types of buildings it would apply to.

And while the tough new energy code would not go into effect unless it is adopted by various cities and towns, officials in Boston, Somerville and Cambridge, where the lion’s share of construction in Eastern Massachusetts takes place, wrote letters of support for the new legislation, Nicolaou said.

“Any project currently being planned or designed anywhere in Massachusetts will have to seriously consider moving forward without knowing what requirements will be in place,” she said.

Greg Vasil, president and CEO of the Greater Boston Real Estate Board, expressed similar concerns.

There will be an impact with process and there certainly will be an impact with costs,” Vasil said. “Everyone recognizes the need to do something with climate change,” Vasil said, calling it a “balancing act.”

Local communities that go beyond the state building code and implement net-zero requirements could force some developers who had planned on building more affordable workforce housing to instead focus on luxury units.

A project, for example that previously would have cost $400 to $500 a square foot to build, might cost $525 a square foot.

“These codes can be onerous and can really drive up costs,” Vasil said.

Gov. Charlie Baker (R) released his own plan this week that would cut emissions by a sizable but slightly smaller 45% over the same time period.

Officials in Baker’s office have said the governor is reviewing the climate change bill passed by the state’s Democratic-controlled legislature, and have not indicated either way whether he will sign it.

Meanwhile, both development and real estate groups said they will also be keeping a close eye on new rules proposed by Boston officials to deal with another facet of climate change— more frequent flooding as sea level rise.

The Boston Planning and Development Agency is pushing a plan for an overlay zoning district that could cover parts of the city that are increasingly prone to flooding.

New projects bigger than 20,000 sq ft, in turn, would have to go through an additional step in the city review process, one that would require developers to make design changes or take other measures to deal with potential flooding.

“It’s understandable why the review has to take place,” Vasil said. “The real catch is how it works practically and how it affects construction costs and what they market will bear and no bear in terms of those costs.”

Lawmakers also sent a $16.5 billion transportation bond bill to Baker’s desk. The bill authorizes billions of dollars in bonds for highway and bridge maintenance, train modernization, and major capital projects such as an MBTA Red Line-Blue Line Connector and the extension of commuter rail service to the South Coast. It also funds the approaches to the two Cape Cod bridges.

Boston First to Embrace Obama-Era Zoning Rules

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Development association backs plan to incorporate fair-housing review for residential projects

By: Scott Van Voorhis | This article was originally published in ENR New England on December 21, 2020

Boston will become the first major city in the country to incorporate Obama-era, federal anti-discrimination rules into the process of reviewing major new apartment and condo projects.

The Boston Planning & Development Agency (BPDA) on Dec. 17 voted to add Affirmatively Furthering Fair Housing rules to the city’s zoning code, a move that comes amid an ongoing surge of large, new residential projects not just downtown, but increasingly in the city’s working-class and minority neighborhoods.

The Obama-era rules became a favorite target of President Donald Trump on the campaign trail, who rescinded the policy over the summer, arguing they would lead to flood of “low-income housing” into the suburbs.

However, the new policy has the solid backing a major trade group representing developers in Boston and across Massachusetts.

Tamara Small, CEO of NAIOP Massachusetts, said the developers in her organization recognize the need for the rules, having formed a group to provide feedback on the proposal to the elected officials working on it.

“It was a collaborative process,” Small said. “We really want to tackle decades of systemic discrimination in housing. Our members are very focused on creating housing opportunities.”

“It is really important to recognize that the real estate industry of today is not the real estate industry of the 1950’s,” Small said.

The organization’s main concern was that the rules and the vetting process be predictable and clearly laid out, as well as having enough flexibility to enable developers to come with creative ways of fulfilling their obligations.

“We also weighed in to ensure there is a process that is both predictable and clear to understand,” Small said.

Under the new requirements, housing developers will use an online tool created by BPDA officials to submit a range of information called for under the new policy, starting with the proposed site of the project and the neighborhood it would be built in.

Developers would also be required to examine the potential for gentrification and other potentially negative impacts on “area residents historically discriminated against,” the development authority noted in a press release.

To head off or mitigate any potential negative impacts, developers would be able to pick from a number of options laid out by the city under the new review process.

These include boosting the number of affordable units available for rent or purchase at below market rates in the proposed project, or further deepening the affordability.

Other options include providing more two-bedroom affordable units large enough for families, or ensuring the number of family-sized, affordable units in the proposed project matches up with the percent of these larger apartments and condos in the neighborhood.

Developers also have the flexibility to propose alternative steps as well to address potential neighborhood displacement and affordability issues, Small said.

“They will have flexibility to come up with creative solutions that might be better suited for that project and for that neighborhood,” Small said.

The proposal was championed by City Councilor Lydia Edwards, with the council voting on Dec. 9 to unanimously approve it.

The last and final stop will come before the Boston Zoning Commission, which is expected to approve the amendment to the city’s zoning rules early next year.

“To reverse the exclusionary housing practices of the past that have kept families of color from accessing safe and secure housing and building generational wealth, we must support aggressive new housing policies that promote equity and fairness,” said Boston Mayor Marty Walsh said in a statement.

Office Space: Dead on Arrival or a New Frontier?

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Tenants Are Getting a Crash Course in Remote Work’s Pluses and Minuses

Written by: Tamara Small | This article was originally published by Banker & Tradesman on October 4, 2020

As we approach the seven–month mark since the state of emergency was declared and office workers transitioned to Work from Home (WFH) overnight, many people are asking the same question: Will workers return to the office?  

A review of statistics paints a bleak picture. Office sublease space is at a record high. Occupancy rates in Boston and Cambridge remain in the single digits, while in the suburbs, it’s about a 10 percent occupancy rate. Companies that once said they would come back after Labor Day are now pushing tentative return dates out to January or well into 2021. We have seen the largest quarterly increase in vacancy rates since the fourth quarter of 2001.  

Given the uncertainty about what is to come, few transactions are happening. Rents are beginning to drop and short–term leases, once unheard of, are becoming much more common. Small businesses that support office workers from dry cleaners, to sandwich shops, to shoemakers remain closed. The economic impact cannot be overstated.  

Eric Rosengren, President of the Federal Reserve Bank of Boston, recently commented on the impact of so many empty office buildings.  

“It’s going to be very difficult for Massachusetts to fully recover until Boston fully recovers,” he said. “And a full recovery in Boston requires people to occupy the office buildings we have downtown.” 

However, we are now starting to see more people return, slowly, but surely, to their offices. And, when there is a vaccine, and children return to school and daycare, and commuters get back on public transit, as an industry we will have a unique opportunity to use what we have learned during this time to make offices better than ever. But what do we do in the meantime? 

While only 4 in 10 Americans can work from home, for those who have that privilege, the overnight transition to WFH was fairly seamless. Many companies who had never offered WFH as an option realized that work can, and will, get done remotely. Technology experts have become the glue that holds the office together – constantly adapting and innovating to accommodate cybersecurity, equity and access challenges.  

Tenants Discover Downsides 

There is a lot of positive that came out of this overnight shift. Several studies show that by eliminating commutes, some workers have gained invaluable personal time. Traffic congestion in our cities has improved dramatically, and many municipalities are expanding their alternative transit options, adding bike lanes and expanding walking paths to encourage outdoor activity. 

However, the longer WFH continues, the more we start to hear about its negative impacts.  

First, the boundaries between work and home have blurred. People are working more, and they are exhausted.  

Second, onboarding and mentorship are suffering. Bringing a new person onto a team that is completely remote is extremely challenging, as is mentoring a more junior employee or intern.  

Third, and most importantly, the collaboration and personal connections that shape successful office culture are difficult to replicate in a remote world. Remote work prevents learning by osmosis and diminishes opportunities for teamwork by eliminating those invaluable five-minute conversations that engage people across teams and disciplines. This has a significant impact on employees, particularly those new to the workforce.  

A recent study of employers by MassDOT/MBTA shows that very few companies plan to switch to WFH entirely when the world returns to “normal”:  52 percent of employers surveyed will send all employees back to the office;  41 percent will send some employees; and only 3 percent will remain full-time WFH.  

Embrace Office Innovation 

Clearly, employees will come back to the office, but work from home is here to stay. People want flexibility, but also some human interaction and collaboration. Are our office spaces ready to rise to the challenge? In short, yes. I predict employers will increasingly adopt a hybrid model that includes some remote and some in–person days. This means a total revision of what office space looks like, how it works, and how employees interact.   

A new and revived office sector will include an increased focus on wellness, collaboration, technology, and community. These components are critical as space becomes more fluid and flexible.  

At a recent NAIOP event, a panel of local experts shared what they are already beginning to see for the future of the office. Elizabeth Lowrey of Elkus Manfredi said, “the days of stack–and–pack are over.” Vickie Alani of CBT shared that we will likely see home offices remain dedicated spaces for focused work, while office spaces will be designed to enable remote and in–person collaboration. Kimberly Smith of Knoll focused on the enhanced role of technology to ensure that people at home and at the office “have an equitable experience in their office interactions.” And moderator Lauren Vecchione of Colliers Boston summed it up with the following statement: “If you take anything away from the discussion today, it should be that employees will come back to the office.” 

So, while the next few months may be a challenge, now is not the time to ring the death knell for the office sector. Instead, it’s time for CRE to embrace innovation and give the people what they want – a new and improved office for the next generation, today.

SJC Supports NAIOP Position in Sudbury v. MBTA

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This morning, in a landmark win for the commercial real estate industry, the Supreme Judicial Court (SJC) of Massachusetts unanimously affirmed the Land Court’s dismissal in Sudbury v. MBTA , holding that the prior public use doctrine is inapplicable when land owned by a public entity is conveyed to a private entity for a different use.

In September of 2019, NAIOP filed an amicus brief with the Real Estate Bar Association urging the SJC to uphold the Land Court’s determination that the state’s “prior public use doctrine” did not apply in this case. Such a requirement would have a significant impact on the ability of any developer to acquire property or even property rights (like an easement) from a public entity (whether a municipality or state agency), resulting in a long, unpredictable and expensive process requiring legislative approval for any change of use in a public property deal.

In its decision, the SJC expressly pointed to NAIOP’s amicus brief, which cited several recent housing projects creating hundreds of units of affordable housing and additional public benefits. Today’s decision allows these and other critical public-private partnerships to continue, creating massive community benefits across the state.

NAIOP is pleased with the SJC’s ruling, and grateful to Jessica Kelly, Daniel C. Johnson, and Ron Ruth from NAIOP Gavel member firm Sherin & Lodgen, and to members of the NAIOP Amicus Brief Advisory Committee, for their work on behalf of the commercial real estate industry on this matter. 

Optimism Colors Shifting Views of Development Market

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Biotech Could Benefit From Open Office Space

Written By: Colin A. Young

This article was originally published by The State House News on September 15, 2020.

SEPT. 15, 2020…..Commercial real estate and development experts said they are confident that the pandemic won’t spell the end of the development boom in and around Boston, but they said they are keeping their eyes on consumer and workforce trends that might reshape their industry.

During a virtual panel convened by NAOIP Massachusetts, the development pros said that while the COVID-19 pandemic slowed construction timelines and injected generous doses of uncertainty into the equation, development still has plenty of track in front of it in the Boston region.

“We operate between Boston and Washington, D.C., and I think that Boston is clearly the strongest market of those three and maybe the strongest market in the country,” Shawn Hurley, president of Marcus Partners said, referring to the Boston, New York City and Washington, D.C., markets. “It certainly seems that development in this market remains really strong and that our economy is more diversified than ever before. So we feel very good about the Boston market and how we’re positioned today, albeit in a very volatile world and as we enter what appears to be a potentially very volatile fall.”

Lauren O’Neil, senior managing director at JLL Capital Markets, said she doesn’t foresee a persistent slowdown in development in the Boston area. After desirable long-term investment-grade tenant leases, she said development appears to be second on the investment strategy depth chart.

“I think the thesis is that we may be in a bit of a slowdown now, but in two to three years when a project is set to deliver it sets up nicely for the rebound in this current slowdown, I won’t go as far as to call it a recession. And so we’ve seen investors and debt capital alike gravitating towards new developments,” O’Neil said. “And in fact, it’s probably easier right now to capitalize on new ground-up development than it is a value-add office deal, for example, where you might have 70 percent occupancy and you’re trying to get to 90 percent occupancy in the near term. There’s just more conviction on what the world will look like in a couple years versus over the next six months.”

O’Neil said hotels and retail developments are struggling to get financed right now. Retail developments with a grocer and that have “a compelling story” might fare better, she said.

“But with the delinquency rate on existing loans in the mid-teens for those product types, it’s going to be a bit of a challenge to get those C-Suites on board with making any sort of aggressive bets on retail and hotel for the foreseeable future,” she said.

Chris Brown, CEO of construction management firm John Moriarty & Associates, said biotech remains one of the hottest sectors in the marketplace right now and the “great need” for added research and lab space has not been diminished by the pandemic. At the same time, there’s “a little hesitancy” to commit to any deals involving traditional office space, given the uncertainties around the future of remote working and the return of most employees to the office.

“Biotech is probably the sector of the market that … will have the most traction moving forward,” he said.

Tamara Small, the CEO of NAIOP Massachusetts who moderated Tuesday’s discussion, asked Brown about converting office space to research or lab space, citing conversations she’s had with people who have suggested that “biotech is the new office.” Brown said his firm is working to “reposition” some office space at the Cambridgeside Galleria and has “a few other projects in the pipeline that look to take existing office space and potentially either add on to it or reposition it for biotech and lab space.”

“That seems to be one of the hottest sectors for us and the most interesting questions we get is in regards to that type of product as well,” he said.

O’Neil said converting office spaces to research or lab space for life sciences and biotech companies could help meet some of the demand for those spaces sooner than the pipeline of new construction could on its own.

“The demand from the tenants on the life science side was growing at an annual growth rate of a little over 8 percent and it’s projected to continue through 2023 at just over 7 percent, which if you look at the current 25.7 million square foot market, that means there’s demand for over 34 million square feet,” she said. “We’re about 3 million short of meeting that demand based on the current pipeline for 2023. Now, that generally includes only ground-up, brand new developments, so maybe the conversion factor will start to fill in some of that.”

The panel also took on the suburbs and the question of whether the pandemic, and the changes it has brought to commutes and daily life, is creating a time for the suburbs to shine and draw even more people out of urban cores. In July, real estate market analysts at the Warren Group said increases in sales in more rural parts of Massachusetts were “far in excess” of the state average.

“Cities are going to endure. The intrinsic qualities that brought everybody to them pre-COVID, we’re going to appreciate them all the more when this ends, and it will end. So we just envision a totally different kind of lifestyle returning when we’re through this,” Abe Menzin, a principal at the development firm Samuels & Associates, said. “In my more optimistic moments, I actually think that remote work options for people could actually enhance the vitality of cities. It could help shave the peaks off of some of the congestion issues that we’ve encountered, and could give people more flexibility in their lifestyle and make a livable city like Boston even more liveable.”

Kirk Sykes, a managing partner at Accordia Partners, is banking on people continuing to want to live in Boston but said aspects of two of his most significant projects aim to address concerns that the pandemic has highlighted. Sykes is involved in the plan to redevelop the site of the Boston State Hospital into a development with more than 360 housing units near Franklin Park and Mass. Audubon’s Boston Nature Center and Wildlife Sanctuary in Mattapan. He’s also part of the plan to convert the old Bayside Expo site in Dorchester into more than 1,000 units of housing, retail space, office space and more.

“We feel extremely blessed to have a 65-acre park, and the beach and the ocean in front of Bayside. And as such, I think those characteristics will play heavily into corporate relocations for campuses or even the decision to get on the train and go for five minutes to Kendall [Square] as opposed to being in Kendall,” he said. “So we’re designing in the desire to be in an environment that gives you the air, the light, the breath, the view that you might get in the suburbs, but getting it in a 20-minute bike ride, 30-minute walk or five-minute Uber/Lyft to the Financial District.”

-END-
09/15/2020

COVID-19 Update: Governor Baker Announces Phase 3 Start Date, Amends E.O. Tolling State Permits; SJC Releases Updated Operations Order; DPU Begins Energy Relief Plan for C&I Customers; MBTA Announces Flex Pass Pilot

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Governor Baker Announces Phase 3 Start Date

Today Governor Baker announced that Phase 3 will begin on Monday, July 6. While Phase 3 is anticipated to be in place until there is an effective treatment or vaccine for COVID-19, Governor Baker indicated that Phase 3 will be implemented in two steps.

Businesses allowed to reopen at this point in Phase 3 include but are not limited to:

  • Fitness Centers and Health Clubs
  • Museums and Aquariums
  • Movie Theaters and Performance Halls (at limited capacity)
  • Casinos (with additional minimum protocols set by the Massachusetts Gaming Commission)

Additionally, the Baker-Polito Administration has updated the guidance related to gatherings. The new guidance related to indoor gatherings will allow eight people per 1000SF, with a maximum of 25 people. Outdoor enclosed gatherings will be limited to 25% of the capacity, with a maximum of 100 people. This updated guidance will be effective Monday, July 6, except for the City of Boston, where it will be implemented Monday, July 13. For all guidance, orders and updates related to the Commonwealth’s reopening plan please visit: www.mass.gov/reopening

Governor Baker Amends State Permit Tolling Order

This morning, Governor Baker signed an Executive Order rescinding and replacing his March 26 Order to suspend relevant permitting deadlines and extend out the validity of state permits.

Importantly, this updated order addressed NAIOP’s significant concerns with the previous order’s appeals language. In the updated order, any individual whose right to appeal would have expired between March 10, 2020 and July 1, 2020 shall have until August 10, 2020 to proceed with their appeal. Any person whose right to appeal expires after July 1, 2020 will be held to the regular or statutory deadline, or by August 10, 2020, whichever is later.

NAIOP advocated strongly for this Executive Order given the extraordinary impact of the previous order on projects throughout the Commonwealth, and we were pleased to see our concerns addressed in the final language. A huge thank you to the NAIOP members who provided their expertise and insight throughout this process.

SJC Releases Updated Order Regarding Court Operations

On June 24, the Massachusetts Supreme Judicial Court (SJC) issued an order further staying certain hearings and trials and limiting court house access until at least July 13, 2020. In addition, the order affirmed that there will be no further extensions of deadlines or civil statutes of limitations beyond June 30, 2020, “unless there is a new surge in COVID-19 cases in the Commonwealth and the SJC determines a new or extended tolling period is needed) and that appeal periods on local permits will begin to run on July 1, 2020.

DPU Begins Energy Relief Plan for Commercial and Industrial Customers

On June 26, the Massachusetts Department of Public Utilities (DPU) approved the commencement of a program designed to assist companies that have fallen into arrears on gas or electricity payments during the COVID-19 pandemic. Full implementation of the program will begin after the March 10 State of Emergency is lifted and current customer protections expire. The Customer Outreach Plan will consist of four phases. You can read the full order by clicking here. Any company having trouble paying their electric or gas bills due to COVID-19 should contact their distribution company for further information.

MBTA Announces Five-Day Flex Pass Pilot for Commuter Rail mTicket

Yesterday, July 1, the MBTA began the new Five-day Flex Pass on mTicket pilot, a program designed to allow greater flexibility for commuter rail passengers as employers and employees explore staggered schedules and telework policies due to the COVID-19 pandemic. The pilot will take place from July 1 – September 30, 2020 and is only available within the mTicket app. Once purchased, the Flex Pass provides five one-day passes that can be used at any time in a 30-day period. This pass, available for all zones and interzones, is a 10% discount when compared to five round-trip tickets.

COVID-19 Update: Boston Announces Office Reopening Framework

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Today, Mayor Marty Walsh announced a new framework for all office spaces located within Boston. Starting June 1, office spaces located within the City of Boston will be required to limit capacity to no more than 25 percent of the maximum occupancy level during phase 1. This framework is in place as an operational recommendation to be used as a reference in line with Federal and State-wide mandates.

These operational recommendations apply to operations during Phase 1 of the Commonwealth’s phased reopening plan, and are subject to revision and modification during subsequent phases or as necessitated by public health considerations. The City’s operational recommendations include, but are not limited to:

  • Identify and clearly communicate a workplace coordinator who will be responsible for COVID-19 and the impact to the workplace.
  • Providing personal protective gear for any employee whose job functions requires it, as identified in the hazard assessment, including training on how to put on and remove equipment safely.
  • Limiting the number of people in an elevator at a time to no more than four. All individuals must wear face coverings in elevators, except where unsafe due to medical condition or disability.
  • Stair usage should be limited to one direction (down) except in cases of emergency.
  • Regular sanitization of handrails, buttons, door handles and other high-touch frequency areas.
  • Establish accommodation and leave policies for employees that are consistent with federal standards.

We encourage all of our members and member-organizations to review the City’s framework. These operational recommendations incorporate the Commonwealth’s Sector Specific Workplace Safety Standards for Office Spaces and supplement them with recommendations based on guidance from the CDC, U.S. Chamber of Commerce, and industry associations to offer best practices for preparing and returning to the physical workplace, preparing your workforce, and ensuring continuity of operations. NAIOP presented to the City regarding Industry Best Practices and we are pleased to see that many of our recommendations have been incorporated into this guidance.

The Mayor has made it very clear that the City hope’s employees who can work from home continue to do so throughout this recovery in order to limit potential exposure and allow for a successful and resilient reopening.

NAIOP will continue to advocate for policies, Executive Orders and legislation that address how this public health crisis is affecting real estate and overall economic development. We are working on numerous initiatives. Please feel free to reach out to CEO Tamara Small or Government Affairs Associate Anastasia Nicolaou if you have any questions.

COVID-19 Update: Governor Announces Reopening Plan – Construction Restarts and Office Space Reopening Standards Released

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Today, the Baker-Polito Administration released its plan for reopening the Massachusetts Economy. Please visit mass.gov/reopening to review the full report, general business guidance, sector guidance, mandatory employer and worker posters, and FAQs on the 4-Phase Reopening Plan. In order to reopen, all businesses must develop a written COVID-19 Control Plan outlining how its workplace will prevent the spread of COVID-19.

Phase One will allow the following (with restrictions, some capacity limitations, staggered start):

  • On May 18: Essential businesses; Manufacturing; Construction
  • On May 25: Lab space; Office space (outside of Boston); Limited Personal Services (hair; pet grooming; car washes); Retail (remote fulfillment; curbside pick-up)
  • On June 1: Office space in Boston

Each phase will last a minimum of three weeks and could last longer depending upon public-health data.

All Construction Included in Phase 1 Reopening Announcement

Governor Baker announced that effective today all construction (including office, retail, etc.) will be allowed to proceed if the appropriate documentation and safety standards and guidance are in place (in addition to any local requirements or restrictions). 

In addition to the mandatory safety standards for all industries announced on May 11 regarding social distancing, hygiene, staffing and operations, and sanitization, the Baker-Polito Administration today released construction-specific mandatory safety standards and guidance. The requirements must be in place before reopening a site, and include but are not limited to:

  • Keeping all crews a minimum of six feet apart at all times to eliminate the potential of cross-contamination
  • No in-person meetings of more than 10 people
  • Where social distancing is impossible, employers will be required to supply PPE including, as appropriate, a standard face covering, gloves and eye protection.
  • The elimination of large gathering places on site such as shacks and break areas, allowing instead for small break areas with limited seating available to ensure social distancing.
  • The designation of a site-specific COVID-19 Officer (who may also be the Health and Safety Officer) for every site except for construction and remodeling work in one to three family residences. This Officer shall certify that the contractor and all subcontractors are in full compliance with the COVID-19 safety requirements for construction.

The construction-specific requirements and guidance allows cities and towns to require additional site-specific risk analysis and safety plans.

Construction in the City of Boston

Also starting today, May 18, the City of Boston will allow a subset of construction projects on sites that meet specific criteria to commence (hospitals, public schools, 1-3 unit residential buildings, road and utility work or other outdoor/open-air work such as steel erection). On May 26, all construction projects in Boston may re-commence construction, if the construction site has submitted a COVID-19 Safety Plan and a COVID-19 Safety Affidavit in accordance with the City’s Temporary Guidance for Construction. 

Office Space Reopening

Starting May 25, the Administration will allow office space to reopen at 25% of capacity, except in the City of Boston, which will allow office space to reopen on June 1. NAIOP has been in talks with the City and we will keep members posted if any additional standards for offices are released. The Baker-Polito Administration has released guidance for office spaces ahead of the May 25 date so that companies are able to review and plan for reopening. The guidance released includes a COVID-19 checklist and mandatory sector-specific safety standards.

The Administration has made it very clear that they hope employees who can work from home continue to do so throughout this recovery in order to limit potential exposure and allow for a successful and resilient reopening.

Plan for Public Transit Released

The MBTA has remained open throughout this public health crisis, and will continue to provide service as adjusted to prioritize essential travel for healthcare and emergency workers. All riders and employees are required to wear face coverings while riding public transit. Stations and vehicles will continue to be cleaned and sanitized with increased frequency, and customers should board at the rear doors of buses and street-level trolley stops. Seniors and individuals with disabilities may still board at the front door if needed. 

COVID-19 Update: Boston Announces Incremental Start to Construction

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On May 5, City of Boston announced it will be taking an incremental approach to broadening the allowable categories of construction. Effective May 5, all essential construction projects (as defined by the state, which currently means residential, hospitals, public schools, mixed use with residential, public works and construction related to COVID-19) with approved safety plans and signed affidavits as required under the COVID-19 Safety Policy for Construction will be authorized to prepare the site with project specific COVID-19 safety measures.

As of May 18, the City of Boston will allow a subset of essential construction projects on sites that meet specific criteria to commence (hospitals, public schools, 1-3 unit residential buildings, road and utility work or other outdoor/open-air work such as steel erection). On May 26, all essential construction projects as defined by the state may re-commence construction in adherence to safety plans.

At no time will the City of Boston permit any construction beyond what is allowed by the Commonwealth. DPW and ISD will continue to monitor and enforce the COVID-19 Safety Plans for Construction. In accordance with the signed affidavit, contractors acknowledge and agree that non-compliance with any requirements may result in suspension of termination of work in progress of revocation of the City’s permit for such work.

NAIOP will continue to advocate for policies, Executive Orders and legislation that address how this public health crisis is affecting real estate and overall economic development. We are working on numerous initiatives. Please feel free to reach out to CEO Tamara Small or Government Affairs Associate Anastasia Nicolaou if you have any questions.

COVID 19 Update: Eviction Legislation Before Senate, Clarity on Construction Moratoriums and Other Issues Affecting CRE

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Construction Moratoriums and Guidance

In recent days, there has been a great deal of confusion over construction moratoriums at the state and local level. We hope the following summary, which reflects the latest information, provides some clarity.

State: On Tuesday, March 31, the Baker-Polito Administration updated the construction related guidance in response to the COVID-19 pandemic. The new guidance limits “essential” construction to housing and critical infrastructure activities. Under the revised list, private nonresidential construction is not considered essential (unless it falls within one of the specified exemptions). As of noon, April 1, only housing projects (including mixed use with housing, infrastructure projects and construction related to COVID-19 can proceed. On April 2, the state updated the FAQ page to answer questions on this issue. The state also issued supplemental guidelines to limit COVID-19 exposures on construction sites and additional guidance outlining the enforcement of COVID-19 safety guidelines. It specifically states that “for all private projects the primary enforcement responsibility rests with the city or town.”

Local: Boston, Somerville, Cambridge, and numerous other cities and towns have issued a halt to all construction until further notice. Companies should maintain the crews necessary to make sure sites are “safe and secure.”  On April 5, Mayor Walsh asked that even if a job is one of the few that is allowed to move forward under current guidelines, companies should consider shutting down. In addition, effective April 2, Cambridge issued its own construction guidance

Commercial and Residential Eviction Moratorium Legislation

On Thursday, April 2, the House passed H. 4615, An Act providing for a moratorium on evictions and foreclosures during the COVID-19 Emergency. The bill provides eviction moratoriums for both commercial and residential tenants. The bill is now before the Senate, where a vote is expected on April 9.

Property Tax Update

As part of Chapter 53 of the Acts of 2020, the municipal relief bill signed by Governor Baker on April 3, municipalities are allowed to extend the due date of quarterly taxes to June 1st.  
 
The City of Cambridge announced it is extending the due date for Second Half Real Estate and Property Tax bills until June 1, 2020. In addition, interest and other penalties on late payments made on Excise Tax and water/sewer bills with due dates after March 10, 2020 will be waived if payments are made before June 30, 2020. It is our understanding that this applies to both residential and commercial.
 
The City of Boston has extended the due date for property tax bills in Boston until June 1st to give residents more flexibility during the ongoing public health crisis caused by COVID-19. It is our understanding this only applies to residential.

BPDA Covid-19 Response

The BPDA is postponing all BPDA-hosted public meetings regarding Article 80 development projects and planning studies until further notice. While projects will continue to be reviewed internally by BPDA staff, the public review process for both Article 80 development projects and the BPDA’s planning studies is on hold until public meetings can be resumed. If you are a landlord or tenant of the BPDA’s housing program, please visit the BPDA’s housing page for information and resources. As the BPDA’s response to Covid-19 continues to evolve, please check this page or follow @bostonplans on Twitter for updated guidance.

COVID-19 Massachusetts Relief Fund

On April 6, Governor Charlie Baker and First Lady Lauren Baker announced the launch of the COVID-19 Massachusetts Relief Fund. It is designed to support organizations assisting Massachusetts’ most vulnerable residents, frontline health care workers, and other essential service providers.  Donations are needed and encouraged.