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WEEK OF MONDAY, FEBRUARY 8, 2016
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A Publication of The Warren Group WORTH THE GAMBLE?
WILL CASINO BE A
WYNN
BY LAURA ALIX BANKER & TRADESMAN STAFF
T
he Fed may have nudged interest rates upward for the first time in nearly a decade, but bankers are settling in for a very long, slow journey back to normal. Moreover, some say the protracted low-interest rate environment still to come could undermine financial stability in the United States. Specifically, the U.S. Treasury’s Office of Financial Research, in its latest report to Congress, mentioned the prolonged low-rate environment as one of the elements contributing to the U.S. financial system’s vulnerability to shocks. Persistently low rates will drive investors to take greater risks and could encourage excessive borrowing. The Fed’s action last December did not alter that assessment, the report said. Though we’ve been in a low rate en-
Studies Show Casinos Have Mixed Impact On Home Values
B
oston Mayor Marty Walsh played his cards well by withdrawing his opposition to the $1.7 billion casino being built in Everett in exchange for an extra $6 million in annual payments over 15 years from developer Steve Wynn. But what will area homeowners be dealt? Experts say is casinos are a mixed bag of benefits and liabilities for area homeowners. The $30 million in one-time payments Wynn will be making to the city of Everett and the projected $25 million in annual property taxes is a nice pair of benefits for the city, but studies show it isn’t a winning hand for everyone at the table. According to a recent study commissioned by the National Association of Realtors, which studied the impact of 358 casinos on their communities, some Everett-area homeowners can expect to see their home values decline. “In general, externalities of conContinued on Page 10
Casino Impact On Home Values 2014
Feds Warn Of Long-Term, Low-Rate Consequences Community FIs Reach For Yield, Enter Commercial Lending Waters
FOR RESIDENTS?
BY JIM MORRISON BANKER & TRADESMAN STAFF
UNDER PRESSURE
Continued on Page 11
Percent Change
2015
Potential Loss In Value
EVERETT
$283,500 $307,500
8.47%
$14,145
MEDFORD
$420,000 $450,000
7.14%
$20,700
AIR UP THERE
Upside-Down Tower Market High-Rise Office Rents Decline BY STEVE ADAMS BANKER & TRADESMAN STAFF
SOMERVILLE
$545,000 $625,000
14.68%
$28,750
CHARLESTOWN
$667,500 $887,000
32.88%
$40,802
CONTENTS Points ����������������������������������������������������������������������� 4
Residential �������������������������������������������������������������� 8
Banking & Lending ������������������������������������������������ 11
By The Numbers ������������������������������������������������������� 6
2015 In Review �������������������������������������������������������� 9
Classified Sections ������������������������������������������������� 14
In Person ������������������������������������������������������������������ 7
Commercial & Industrial ���������������������������������������� 10
Records Section ������������������������������������������������������ B1
P
ayPal’s move into office space at One International Place was considered a pioneering move in 2013, but the sight of tech startups in buttoneddown Financial District towers no longer raises eyebrows. When PayPal put 30,000 square feet up for sublease last fall, four or five tech companies expressed serious interest within a week. DataRobot, a Boston-based software company that serves the data industry, emerged as PayPal’s replacement. The transformation of downtown Boston’s office market continues with an influx of tech tenants scooping up space in towers to fill gaps left behind by the banking and financial service sectors. Unlike the law firms and investment managers who favor upper-floor space, however, tech companies have driven leasing activContinued on Page 10