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KS Partners sells approved downtown Boston office conversion site

KS Partners sells approved downtown Boston office conversion site

Built World Boston, MA local

The Woburn developer exits a 95-unit project approved under Boston's conversion incentive program.

4 days ago: KS Partners sells approved conversion site

Overview

Updated 4 days ago

A Woburn developer sold a downtown Boston office building approved for conversion into 95 apartments for $8.6 million, or about $90,500 per approved home. KS Partners won the conversion approval in April 2025, then sold the site rather than build it.

Boston's conversion program gives developers up to 75 percent off property taxes for 29 years, plus state grants. The sale shows how hard it remains to turn vacant offices into housing even with those incentives.

Why it matters

Boston expects office conversions to create 1,700 downtown homes; each developer that sells an approved site instead of building delays that housing.

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Key Indicators

$8.6M
Sale price of approved 95-unit conversion
KS Partners sold the approved site instead of building it.
95
Approved apartments in sold project
The 85 Devonshire and 258-262 Washington conversion was approved in April 2025.
1,700
Homes Boston's program targets
Citywide goal across 24 applicants and 29 buildings.
1
Conversions under construction in June 2025
Only 281 Franklin Street had broken ground when the state announced $7 million in grants.

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People Involved

Organizations Involved

Timeline

June 2019 September 2026

6 events Latest: 4 days ago
Tap a bar to jump to that date
  1. KS Partners sells approved conversion site

    Latest Sale

    KS Partners sold the approved 95-unit conversion site for $8.6 million instead of building it.

  2. State awards $3.4 million for Court Square

    Funding

    Massachusetts awarded KS Partners $3.4 million of a $7 million grant round for downtown conversions.

  3. Court Square conversion application filed

    Regulatory

    KS Partners filed plans to convert 15 Court Square into 80 apartments under the city's incentive program.

  4. 95-unit Devonshire conversion approved

    Regulatory

    Boston Planning Department approved KS Partners' plan for 85 Devonshire and 258-262 Washington streets.

  5. Court Square loan enters special servicing

    Financial

    The loan on 15 Court Square matured with a $25 million balance and was placed into special servicing.

  6. KS Partners buys 15 Court Square

    Acquisition

    KS Partners paid $29 million for the 11-story office building, then 98 percent leased.

Scenarios

1

New owner builds the approved 95 apartments

Possible Resolves by End of 2027

Discussed by: Real estate press tracking Boston conversion construction

The buyer, not named in the sale announcement, proceeds with the approved plan. Construction starts, adding 95 units to downtown housing stock. Other approved conversions, like 31 Milk Street and 15 Court Square, move in parallel as the program builds momentum.

2

Site sits vacant, conversion stalls

Likely Resolves by Q2 2028

Discussed by: Analysts skeptical of office conversion economics

The buyer acquired the property for its land value rather than to build apartments. High construction costs and interest rates keep the approved conversion on the shelf, adding to the pattern where approvals outpace actual construction.

3

Boston boosts incentives after slow progress

Possible Resolves by Q2 2027

Discussed by: Wu administration, Boston City Council, housing advocates

With only a handful of conversions under construction, the city increases the incentive package. Larger tax breaks, added state funding, or expedited permitting aim to push approved projects like this one into construction.

Historical Context

2 moments from history that rhyme with this story — and how they unfolded.

2001-2005

Lower Manhattan conversion push (2001-2005)

After the September 11 attacks drove companies out of Lower Manhattan, office vacancy passed 20 percent. The city and federal government channeled Liberty Bond subsidies and tax breaks into residential conversions, turning empty towers into apartments.

Then

Thousands of apartments emerged from converted offices, reviving the Financial District as a 24/7 neighborhood.

Now

The district's residential base cushioned it when office demand fell again.

Why this matters now

Public subsidies large enough to close the gap between conversion costs and apartment rents made Lower Manhattan work. Boston's smaller incentives are testing the same math.

2022-2026

Chicago LaSalle Street conversions (2020s)

Chicago's city government offered property tax incentives to convert aging LaSalle Street offices into housing. The program aimed to create thousands of units in buildings emptied by remote work.

Then

Fewer conversions reached construction than proposed, as high interest rates pushed financing costs above projected apartment rents.

Now

The program became a catalog of obstacles for office conversions in expensive office markets.

Why this matters now

Chicago's experience foreshadows Boston's: approvals run ahead of construction because the financials rarely close.

Sources

(5)