Capital Security Advisors, Brickman Associates, and Shimizu Jointly Acquire Two Office Buildings in Boston

Shimizu Corporation (President Kazuyuki Inoue) recently acquired two rental office buildings in the Back Bay neighborhood of, Boston, Massachusetts through its United States based real estate subsidiary as a part of its overseas real estate development business expansion plan. The purchase price of these buildings, located at 535 and 545 Boylston Street, was approximately 17 billion yen ($150 million USD). To enhance the value of these buildings, Shimizu will implement an infrastructure upgrade plan with a projected budget of approximately 1 billion yen ($8 million USD).

Shimizu’s U.S. subsidiary, Shimizu Realty Development (U.S.A.), Inc. (SRD), which is responsible for the real estate business in the U.nited States., jointly established the ownership entity, SCB Boylston PO, LLC, with local real estate companies Capital Security Advisors and Brickman Associates. SCB Boylston PO, LLC will own and operate these two properties. Under this corporate structure, SRD owns a stake of approximately 97%.

Boylston Street is centrally located within Boston’s Back Bay neighborhood which is a well-known, high-class office street lined with law firms and financial institutions. Back Bay is adjacent to East Cambridge where a cluster of startups in the life sciences field and other sectors is found; The Back Bay is now beginning to attract this high-demand, fast growing sector.

The acquired properties are comprised of two rental office buildings, which are partially connected on several floors. Each building contains 1 basement floor and 13 above-ground floors, with 17,593 m2 (189,372 square feet) of total floor area, as well as, LEED Gold Certification status. The current occupancy is approximately 90%. The buildings will generate stable rental income and Shimizu expects to divest the properties in accordance with the expected hold period.

Shimizu’s Mid-Term Management Plan (2019-2023), publicly announced in 2019, targeted a strengthened real estate development business in North America. Based on this Mid-Term Management Plan, Shimizu has expanded its real estate business in the U.S. with the acquisition of the Albano Building, a rental office building in New York City in 2019, and the acquisition of The Shaw, a brand-new luxury apartment building in Washington, D.C. in 2020. Shimizu will continue to expand upon its value-add-type investments in the office and rental apartment sectors in major U.S. cities, primarily on the East Coast, while also considering investments in the development of logistics facilities in the Southeast, in order to diversify its real estate portfolio.