To read a related story, click here.
Copyright (c) 2006 Globe Newspaper Company
The Boston Globe
MCCOURT REPORTEDLY SELLING S. BOSTON SITE
NEWS CORP. MAY BUY THE 24 ACRES
by Thomas C. Palmer Jr., Globe Staff
Landowner Frank H. McCourt Jr. is selling the 24 acres he owns on the South Boston Waterfront to pay off a loan he took out two years ago to buy the Los Angeles Dodgers, a spokesman for the buyer said yesterday.
The price for the land could be as high as $225 million, according to an executive involved in the deal. He spoke on condition of anonymity because a deal has not been signed. That is significantly higher than the $145 million value of the loan McCourt obtained from News Corp., the media company controlled by Rupert Murdoch that sold the Dodgers two years ago.
Andrew Butcher, a spokesman for News Corp., said, "We don't have a deal yet, but it does look that way." He said he could not provide details of the planned transaction.
Neither side would say when the sale would close.
If the land does change hands, it means the end of a long era of stalled development and bickering about a central block of vacant land in South Boston, and the exit of McCourt, a scrappy figure on the Boston development scene who now lives in Los Angeles.
"I think all the obstacles are out of the way, and it's like Monopoly," said Mayor Thomas M. Menino, who has long battled with McCourt to develop the land, which is now used for parking cars. "We're on Park Place, and we're moving forward."
A sale also would mark the second big change of ownership on a swath of land on the waterfront within four months. In September, Boston developer Joseph F. Fallon bought the 21-acre Fan Pier site adjacent to McCourt's land from Chicago's Pritzker family for $115 million.
Fallon is proceeding with plans to build residential, retail, and office space on Fan Pier, which for two decades had eluded plans for elaborate development.
"It's going to mean the end of an era, the beginning of a new one out on the waterfront," said Vivien Li, executive director of the Boston Harbor Association. "We're now getting a whole new group of investors and developers."
McCourt "was one of those who shared a vision in the shaping of South Boston, whether you agreed with him or not," Li said. "It's almost too bad he's not going to be around."
The real estate firm Cushman & Wakefield of Massachusetts Inc. had been trying to sell all or part of McCourt's property for him for two years.
JPI, a Texas apartment builder with experience in Massachusetts, had been negotiating to buy about three acres of McCourt's land on the western side of the property, near the Fort Point Channel.
"It was a very good offer," said Rob Griffin, president of Cushman & Wakefield. "I know it was being considered by Frank and News Corp. I don't know what the future holds." No one from JPI could be reached for comment.
But Menino said, "Already several companies have called the redevelopment authority about the possibility" of developing on the McCourt land.
Butcher, the News Corp. spokesman, said it was too early to speculate on whether the company would sell the land, in whole or in part, or try to develop it with a partner. McCourt had been negotiating for about a year with the Related Urban Development of New York to jointly develop his property. Kenneth A. Himmel, chief executive of Related, was one of the developers of Copley Place.
As of next month, McCourt was required to pay News Corp. $125 million for loans he signed with the company to fund his purchase of the Dodgers, plus about $20 million in interest. He backed those loans up with his South Boston land.
"The hammer's down. He has to do something to pay off" the loan, said Mark W. Hall, senior vice president of Hunneman Capital Group, who had been contacted previously by News Corp. about selling the McCourt loan.
A McCourt associate briefed on the sale agreement said that when the sale takes place, "This ends all the obligations McCourt had to News Corp. regarding the purchase of the Dodgers."
Plans of the sale were first reported in yesterday's editions of the Los Angeles Times.
In the years he has owned the land, McCourt has sparked controversy with his development proposals. McCourt unsuccessfully tried to buy the Boston Red Sox and win support to build a new ballpark on the land. He also tried to sell the idea of a grand boulevard surrounding a domed Silver Line station on his land, and he sniped at the Pritzkers' plans to develop Fan Pier even as City Hall criticized McCourt's own plans.
Yesterday, a spokeswoman for Related confirmed "that we are no longer in negotiations with Mr. McCourt." The spokeswoman, Pam McDermott, said she could not address whether Related was now talking to News Corp. about developing the land after a sale is final.
McCourt bought the Dodgers and real estate in Los Angeles and elsewhere from a News Corp. subsidiary, Fox Entertainment Group, for about $430 million in 2004.
McCourt's land, unlike the nearby Fan Pier, does not have permits for development. But it does have adjacent roads, some utilities, and a major MBTA stop, Courthouse Station, on the new Silver Line that connects South Station to the waterfront.
Approval for development can take more than three years. Time and nearby development may have increased the value of the land, but a recent Federal Aviation Administration effort to reduce the height of buildings around airports could mean that buildings on the McCourt land would have to be smaller, so the land, which is under flight paths to Logan International Airport, could be less valuable.
Thomas C. Palmer Jr. can be reached at email@example.com.
Copyright (c) 2006 Globe Newspaper Company
Your comments as a visitor to the SAND website would be appreciated and forwarded for discussion.