Harvard University has bought Boston’s Watertown Arsenal from O’Neill Properties Group for $162 million.*
King of Prussia, Pa.-based O’Neill Properties bought the site, which had been an armament supply house for almost 200 years, for $24 million two and a half years ago from the town of Watertown and the U.S. Army. Having spent $110 million to do the renovation, O’Neill Properties grossed roughly $28 million on the sale. The 40-acre, 754,000-square-foot site, while modernized to attract strong tenants, was designed to maintain as much of its history as possible.
Harvard, which will use the site to house the publishing division of the Harvard Business School as well as other tenants, was the first tenant to rent space at the site. The university first signed its 20-year lease for 110,000 square feet at the same time that O’Neill Properties bought the Arsenal.
About a year later, O’Neill Properties signed consultant company Arthur D. Little Inc. into a 20-year lease for 360,000 square feet of space at the Arsenal. Part of that arrangement was O’Neill Properties’ agreement to purchase the company’s 415,000-square-foot headquarters building in Cambridge. Having paid $21 million for that site, O’Neill Properties promptly leased it up and turned around to sell it for $63 million with no renovation required.
*The actual purchase price of the Watertown Arsenal project was $168 million.