Throughout the course of American history, transportation and commerce have been inextricably linked. The early American settlements of Jamestown, Virginia, and Plymouth, Massachusetts, were in fact the “ports” where the ships from Europe landed. The industrial revolution saw the proliferation of railroads, which linked cities to other cities and provided outlying rural areas with access to the urban core. Rail was so important to the health of the economy that grand monuments were built in the heart of major metropolitan areas to house trains and accommodate passengers and freight alike. The rise of the automobile provided an alternative to rail and these stations suddenly had substantial excess capacity. As cities have continued to grow in terms of their economic importance, these train terminals are enjoying new life as dynamic, mixed-use assets, effectively serving as the heart and soul of its city.
Annual Visitors: 68.3 million
Fueled by a booming trade and banking industry, Grand Central was built as a central hub for the Hudson, New Haven and Harlem Railroads. The terminal was constructed over a decade at a cost of $80 million (roughly $2 billion today). Grand Central has since undergone several renovations and has been transformed into a major mixed-use transportation and retail hub. Retailers range from the Apple Store to the top-ranked Michael Jordan’s The Steakhouse restaurant.
Annual Visitors: 42 million
Union Station was constructed in the early 1900s by the Pennsylvania and Baltimore and Ohio Railroads as a critical link to the nation’s capital. In the late 1980s, Union Station underwent one of the most successful adaptive reuse transformations with a $160 million rehabilitation project that included a significant retail expansion. Today, the station offers an upscale shopping experience with more than 130 retailers and also hosts major public and private events.
Annual Visitors: 8.5 million
The Ferry building was constructed in 1898 and served as the primary entry point to San Francisco. In 2003, a four-year $100 million restoration project was completed that gave the Ferry Building new life and was a turning point in the revival of San Francisco’s waterfront. In addition to the ferry terminal, the building features 175,000 square feet of premium office and a 65,000-square-foot retail marketplace.
Annual Visitors: 43.2 million
Completed in 1899, South Station was built to link four railroad lines: The New York and New England Railroad; Old Colony Railroad; Boston and Albany Railroad and the Boston and Providence Railroad. At the time, South Station was the largest railroad station in the world. The five-story head house was designed with a grand waiting area for passengers and railroad offices on the floors above. Following decades of declining use, the MBTA invested nearly $200 million into the restoration of South Station in the mid-1980s. The revived landmark now includes expansive retail and creative office in the heart of Boston.
Given the outsized impact that urbanization is having on commercial real estate, it only stands to reason that these transportation hubs will continue to be a focal point for their respective submarkets. As cities densify, access to public transportation is becoming more and more important. To the extent that these structures can be more than a utilitarian building, the more they will be an integral piece of the urban fabric.
Ben Sayles is a director in the Boston office of HFF with more than 15 years of experience in commercial real estate. He is primarily responsible for investment sales transactions focusing on office, multi-housing and retail properties.
A graduate of Trinity College in Hartford, Connecticut, Mr. Sayles is the Director of the Commercial Brokers Association and an Executive Committee member of NAIOP Massachusetts. Additionally, he is active in several other notable commercial real estate professional groups, including Urban Land Institute and International Council of Shopping Centers.
Sam Campbell is a Real Estate Analyst in HFF’s Boston office. He is primarily responsible for performing financial and market analysis, preparing offering documents and coordinating the due diligence process for both the investment sales and debt placement groups.
Mr. Campbell joined the firm in January 2017. Prior to joining HFF, he worked at Ernst & Young in their tax group serving real estate clients.