Harvard and BU Set Sights on New Allston Property

Harvard and Boston University are both eyeing Allston industrial properties put up for sale on Monday by the debt-ridden Massachusetts Turnpike Authority.

Located south of the Business School and lying adjacent to other Harvard properties, the 91-acre site is the largest single parcel to come to market, bigger even than the adjacent 47-acre Allston Landing North parcel, which harvard bought from the Turnpike for $151 million in 2000.

However, a number of obstacles stand in the way of development—the property is crisscrossed by miles of iron and concrete, cut in two pieces by the turnpike, and dominated by rail lines owned by CSX—which has rights to use the land in perpetuity.

But Harvard has taken on similarly encumbered parcels in the past in the name of long-term planning.

Harvard already owns nearly 300 acres across the river in Allston, land similarly riddled with rail yards and auto body shops—and the site of Harvard’s much celebrated but as-yet undefined campus of the future.

And for now, the University hasn’t stopped shopping across the river.

“I think the right way to think about the University is, we’re not like somebody moving to a new city looking for a house,” said University President Lawrence H. Summers. “We’re always interested if land becomes available for purchase.”

But if Harvard wants the new real estate, known as Allston Landing South, it may need to compete with BU, which has expressed interest in expanding onto the land out of its nearby Charles River Campus.

The land might well be a key piece in Harvard’s long-term Allston planning puzzle—but administrators say the land’s encumbrances and distance from Cambridge mean that the parcel is not a sure bet.

One Man’s Junk...

Like the nearby parcel Harvard already owns, the potential of the new land is severely limited by its tenants, the CSX rail yards and the turnpike itself.

And Harvard is more skeptical about its need for this land than it was at the Turnpike Authority’s last Allston sale.

Sally Zeckhauser, vice president for administration, said Harvard would need to further investigate the property before making a decision to bid.

She said that the land’s distance from Harvard’s campus and its heavy encumbrance make it less attractive than other sites in Allston.

“The land adjacent to the Business School is the part that is of the most interest,” she said. “Northern land is really our primary focus, near Western Ave. This property is south of Western Ave., and our interest is certainly diminished the farther south the land is.”

Three years ago, when Harvard bought the 48-acre Allston Landing parcel, the University fended off bids from BU by giving its cross-river rival the option to buy 10 acres within the parcel.

If both schools decide to bid on the new land, Harvard would again attempt to avoid a bidding war with BU, Zeckhauser said.

“Its fair to say that we don’t want any kind of adversarial relationship with BU,” she said. “If there were any interest [for the land] we would like to come to some form of an agreement.”

The new pieces of land were valued at $100 to $125 million a year and a half ago. According to a Globe report, internal Turnpike Authority papers contained the estimate that Harvard would shell out as much as $150 million for the 91 acres.

But Zeckhauser said this time around, Harvard may be the less enthusiastic of the two potential buyers.

“Given its location, the land probably has less interest to us than it does to B.U.,” she added.

BU Spokesperson Colin Riley declined comment on what the school would plan to use the land for, but confirmed that BU has a strong interest in buying the property.

“For a long time we’ve had interest in this land because it’s adjacent to us,” he said.

B.U. is currently engaged in a billion-dollar capital improvement project to renovate its athletic and housing facilities.

Zeckhauser would not comment on Harvard’s dealings with B.U. or with tenant CSX, which already leases land from the University in Allston Landing North.

But she said the railroad’s indefinite presence on the new land was also a large consideration in deciding whether to place a bid.

“Any encumbrance affects how Harvard would think of a piece of land,” she said.

Nevertheless, University spokesperson Lauren Marshall said in an e-mail that the long-term nature of Harvard’s development project has kept all options on the table.

“The University looks at Allston in the long-term, and what might be potentially possible decades from now,” Marshall wrote. “We want to have as many options as possible for Harvard well into the future.”

Given the heavy infrastructure already on the property, long-range planners would have the most to gain from buying the land, said Turnpike spokesperson Sean O’Neill.

“This is a good growth opportunity for an adjacent property owner with long term development goals,” he said.

Christy Mihos, a Turnpike board member who has been pushing for the sale of the land since 2001, said that CSX’s occupancy will likely not be a deterrent to institutional developers.

“There are zoning issues, existing easements, and the community will certainly have a lot to say about it,” he said of the challenges posed by the land. “But one man’s junk is another man’s riches.”

Possibilities and Pitfalls

Paul Berkeley, chair of the Allston Civic Association, said that even if Harvard or another buyer could facilitate the removal of CSX, an extensive renovation of the landscape would need to follow.

“There’s an incredible amount of contaminants in the ground there, so there would have to be a tremendous environmental cleanup,” he said.

Besides being a complicated undertaking, Berkeley added that developing the parcels might not be in the best interests of the community.

“These industrial sites have an important economic impact on the area,” he said. “If BU ended up there, what kind of jobs would they create?”

CSX spokesperson Robert Sullivan would not comment on the company’s future plans for its rail yards in Allston, but emphasized the importance of the site for its freight services.

“Its an important freight yard for us, for our customers in Boston and for the region,” he said. “Just the sheer number of trucks coming on and off the nearby Turnpike is a good indication of just how busy that yard is. This is a facility that we do not take lightly.”

One railroad customer in Allston said that his business depends on CSX in its current location.

“In general we’re uncomfortable with [the auctioning of the land],” said Bruce Houghton, president of Houghton Chemicals, which has a factory adjacent to the rail property. “We utilize the services of the railroad extensively.”

Houghton predicted a widespread impact across the area if the railroad were to leave.

“The key to all of this is not who owns it, but really what happens to that rail yard, and how does that affect the pricing of all goods, affect the competitiveness in industry,” Houghton said. “If there were no rail available it would substantially increase our costs, which I suppose we would pass onto our customers. If that happened to all the freight coming in, the cost of living in New England would increase to some extent.”

Berkeley said he worries that removing CSX’s lines would mean an influx of unwanted freight traffic on Allston’s roads and on the nearby Turnpike, some of which would carry hazardous materials formerly transported by rail.

“Those things would have to go on our streets,” he said. “It wouldn’t be the best thing for the companies or the community.”

The Turnpike’s decision to auction off the heavily encumbered land comes in the midst of a $2.2 billion cost overrun on their Central Artery/Tunnel Project, the centerpiece of the city’s Big Dig and the largest highway construction project in American history.

“The hope is to raise as much cash as we possibly can, while keeping tolls down,” said board member Mihos.

Bid proposals for the parcels of land are due by noon on March 31, 2003.

The Turnpike is adopting a wait-and-see approach to the question of whether it would negotiate changes to the highway itself with BU, Harvard or any new owner.

“We can cross that road when we get to it,” O’Neill said.

—Staff writer Lauren A. E. Schuker contributed to the reporting of this article.

—Staff writer Alex L. Pasternack can be reached by e-mail at apastern@fas.harvard.edu.