Adaptive Reuse Of Saints Peter and
Paul Catholic Church
into Residential Condos
South Boston, MASS
By Robert Simons
The former Saints Peter and Paul church and adjoining rectory at 45-55 West
Broadway in Boston, Massachusetts was a Catholic church in the predominantly Irish
section of South Boston, and was built in 1844. The Catholic Diocese of Boston divested
itself of the 35,600 SF property, with 28,000 SF built space, selling it “as is” to West
Broadway LLC, headed by Developer James McFarland, in 2001. The McFarland firm
selectively gutted the 60 foot high building, and redeveloped the former Catholic Church
into six stories of upper-end residential condos. The smaller rectory was kept mostly
intact, and was developed first. The end project included 44 units, with 8 in the adjacent
rectory, 36 in former church building itself. The market at that time of redevelopment in
2002 to early 2004 was growing and firm, with prices for the average 1,100 SF units
ranged between $230,000 to $790,000 ($285 to $415/SF). 25% of the units were set
aside as affordable. Two separate outside realtors handled the transactions. The project
absorption averaged about 3 units per month, and the rate of project rate return was about
5% on overall development revenues of $11.7 million. Features of the case included
maximizing space in a large Church, limited issues with neighbors, constructing a new
multi-story building inside an existing statuesque and dignified structure, retaining as
much architectural detail as possible as they worked their way up through the building,
hitting the market window, and winning a profit by using a vertically integrated
Date built 1844, the Saints Peter and Paul Catholic Church was for decades a
mainstay in the religious life of Irish Catholic South Boston. The facility included a
church, rectory and small garage on 0.82 acres near I-93 and I-95, on a main commercial
street just south of downtown Boston, a stone’s throw from the Broadway Red Line T
subway station. At the time of redevelopment, the building was surrounded on all sides
with non-residential uses, including retail and service uses. The project has been catalytic,
however, and now two adjacent multifamily residential projects with over 100 units are
The gray granite main church building built in 1844 was 17,800 SF with a full
basement and worship space on the 60 foot high first floor plus the organ and choir space.
The rectory was 12,000 building square feet (SF) on five residential floors. There was
also a small service garage. Distinctive church features included stained glass windows,
a bell tower steeple, and 3 foot thick grey granite walls, and vintage handcrafted
stonework over the Broadway entryway. The red brick rectory had nice woodwork inside,
and was in very good condition, add Years of major remodeling/additions and other data
from (see offering brochure) ,
The building had been a Catholic church from 1844 to 1995. The rectory was
always occupied with church personnel. The church building been carefully closed, but
sat empty for 5 years between 1995 and 2000. The Boston Catholic Diocese sold
building in an open bid format, but before the binge of church closures and sales which
occurred in Boston a few years later.
Map of area, city, neighborhood insert. 2-3 pages plus map.
Market Area Demographics at time of redevelopment
According to the 2000 U.S. Census, Boston MSA had a total population of
5,819,101 making it the 11th largest MSA in the nation. The Charlotte Chamber website
estimated about 0.8% increase in population in the MSA from the year 2000 to 2006. The
St. Peter and Paul Church is located predominantly white and historically Irish South
Boston, in a census tract where 43% of the population is in the 22-39 age group and 17%
of the residents are 60 years and over. The census tract is located in City of
Boston/Suffolk County, which is the 3rd largest in the state of Massachusetts with a
population of 0.6 million according to the 2000 Census (US Department of Commerce,
Bureau of the Census 2000). By 2005, the population of the county was up to 676,299
The tract-median household income in 1999 was $37,188, lower than the County
($39,355) and much lower than that of the MSA ($52,792). The tract population was
predominantly White (95%) with rest of the people being African American (1.0%) and
others Asian (3.0%) in the year 2000 (Source: www.census.gov). The racial mix in the
county in 2005 (according to “City Data) was as follows: African-American 22%; White
68% (of this Hispanic whites comprised 16%) and people of Asian and other races was
About 19% of the people of age above 25yrs, hold a Bachelor’s degree or higher,
which is about the same for the County (19%) as well as the MSA (20%). About 26% of
the above 25 yrs age group are high school graduates, being slightly less than the
averages of the County (27%) and the MSA (28%). The tract has a low unemployment
rate of 4.0%, same as the County (4.0%) but slightly higher than that of the MSA (3.0%)
(Source: US Census 2000).
In the year 2000, there were 963 households in the census tract, of which 43 %
were one person households. That figure is higher than for the Suffolk County (36.2%)
and the Boston MSA (27.2%). The residents’ median age is 31.7 years. There are
approximately 295 schools, both public and private, in or near the Suffolk County and
nearly 164 public libraries (Source: www.citydata.com).
The multifamily housing market in the County (including condos and apartments)
is dominated by structures with 20 or more units. They total to about 60,574. Three/four
unit structures (73,731) are also well represented. The median selling price of a condo in
December 2007 was $270,000 which remained unchanged from December 2006 and the
median selling price in May 2008 for single-family homes fell 9.2% to $322,500,
compared with $355,000 in May 2007 (Source: www.boston.com).
In general, market timing was good. All property markets were stunned by the
events of 9/11, about the time that the deal was coming together. The condo market
started to heat back up in late 2002, was fine through the project’s marketing window in
2004, and started softening up in 2005 and 2006.
The controlling entity for disposal of the Church-Rectory complex was the
Catholic Diocese of Boston. They put up the buildings for a packaged competitive bid in
2001. James McFarland was the successful bidder. McFarland, along with and sons
Bernard and John, became the developer/owner, and builder of the project.
James was an Irish immigrant, arrived in Boston as a young adult. He opened a
property development firm in the late 1960s, and started buying and rehabbing houses
and doing general contracting for Boston Housing Authority and the Boston
Redevelopment Authority (BRA), and generally doing structural repairs to housing.
McFarland also had a redevelopment business. Prior to this project the McFarland Family
Firm had done about 50 separate housing-related development and redevelopment
projects, including one church rehab, but not into residences (James McFarland 2008).
This project was their first venture into rehabbing a church into housing. They were to
wear several hats: developer, owner and builder: this was a vertically integrated project.
Getting the property. With respect to property acquisition, McFarland had time on his
hands between jobs in early 2001 when the RFP to acquire the church “as is” came out.
This meant he had time to develop a thoughtful and comprehensive proposal, which was
very time-consuming. About 20 firms submitted bids to the Boston Catholic Diocese to
get buildings. McFarland won the bid competitively and straight up, partly because of his
experience, but also because of the 25% affordable housing units he was willing to set
aside. The price ($2.4 million), having housing as the end use, promising no demolition
of buildings, and having financing lined up as part of bid package were also keys to
winning the bid.
His construction lender was Andover Bank, where he had a successful 10 year
relationship, and his approach was to minimize risk in cost over runs, along with a credit
history that resembled a Swiss clock. Some presale agreements were agreed to.
McFarland had market comparables.
McFarland selected the Architect: Wendell Phillips Architects, who had
substantial restoration experience. The architect prepared persuasive several renderings
for the proposed project, which were helpful later in public meetings.
The plan was to redevelop the buildings into for-sale housing. The 1st floor and
basement were generally combined into 12 two story duplex units, averaging @1200 SF
average. Floors 2 and 3 had 9 and 8 units each, respectively. These were flats, averaging
@700 SF. The affordable units were among these two groups of flats and duplexes. Floor
4, the penthouse level, had seven units, all duplexes. Their average size was @1,800 SF.
The biggest one was 2000 SF. Many had excellent church roof features, such as structural
arches and painted ceilings. They also had little pocket balconies with views of the City.
Process . Once the bid was won, the developer had business risk because the building
was owned outright, without being able to resort to the usual property option approach.
The public agency spearheading the redevelopment was the Boston Redevelopment
Authority (BRA). The BRA process includes public vetting and BRA rezoning, design
review and plan approval first, followed by a then a trip to the zoning board. The project
was vastly simplified with no city money, no tax credits, and only an advisory role for the
Historic property commission.
James McFarland said that “the hardest and riskiest part of this deal was buying
the buildings without having planning approval or building permits”. The project
required rezoning: the area is generally zoned industry, and had to be rezoned to
The BRA process required public input. The architect prepared renderings and
floor plans, and they went with the developers and BRA to 3 neighborhood public
meetings over 3 months. Over these meetings, there were no substantial changes to their
original proposal. Because this was among the very first churches the Diocese sold in
Boston, it was somewhat of a novelty. Also, the fact that the Diocese had boarded up the
church building windows after extracting most stained glass windows gave the project the
benefit of appearing to “unblight” the neighborhood.
Community reaction to the project was generally positive. Due in part to the lack
of any residential property abutters, no opposition emerged, and thus the project was an
INBY (in nobody’s back yard). The sparsely attended meetings generated only a dozen
folks, and few local residents.
The public process was reasonably quick and smooth: only one delay glitch and 8
months overall. After the public meetings, BRA rezoning and design review went fine.
Because the buildings were not in a historic district, not on the historic register, and not
asking for historic preservation tax credits, the Boston Historical Commission was
involved as a non-binding advisory body. Their input was still required as part of the
BRA review, but “best efforts” was sufficient: Cutting utility dormers and pocket deck
(balconies) for example, and an ADA handicap access ramp were minor issues. The BRA
approved, and the Historic Commission went along.
The next and the last step before pulling permits was the Boston Zoning Board.
The case was heard, but the Boston Zoning Appeals tabled it initially. One city councilor
objected, and wanted more consideration of the parking ratio (one on site surface space
per unit). Another reading was scheduled for a month later. McFarland’s attorney did
some lobbying, mostly along the lines of pointing out the opportunity lost of having the
building remain empty, desolate boarded up and abandoned. The next zoning board vote
came back with unanimous approval of preliminary plans. It then required about 6 more
months for detailed plan approval from the BRA. The developer pulled permits just after
Christmas of 2001, and started construction on January 2, 2002 (James McFarland 2008).
As set forth in the winning proposal to the Diocese, the guiding concept was to
retain the keep the outside of the two buildings intact. This was accomplished except for
taking out the little service garage, and adding several small utility dormers, and some
cut-in balconies for the penthouse units. Some windows also had to be added for light
(more on this later).
The rectory building went first and was straightforward: it was kept largely intact.
McFarland demolished and relocated several interior partition (non-load bearing) walls,
to create the legal and market-ready entrances to the units, and meet building code. The
Rectory had been set up as one residence, so had be reoriented toward 8 unit
Redeveloping the church was next. Prior to selling property the Diocese had
religiously decommissioned the buildings, a but left about ten smaller and more ordinary
stained glass window, mostly little arches. The empty windows were boarded up. These
features were retained. The church pews and organ were sold off at minimal prices or
The main construction challenge was cutting in six 25 foot high windows into
south (back) side of the church, to add light. The church exterior wall comprised of
granite stone 3 feet thick. It took 3 contractors before one could figure out how to do the
job right (Bernard McFarland 2008).
The church basement was a generous height of ten feet to start with. McFarland
added footings for new load bearing walls and laid in plumbing stacks. A new basement
floor had drain lines set in. The church was 60 feet high inside, and there was an existing
basement and first floor level. This meant adding 4 new stories to the project, all built
inside the church existing structure. This was accomplished, efficiently, with the focus
being functionality. The front door entryway was done in a similar vein, with little
inking of the structure’s past grandeur. A bell and clock tower were preserved, but not
restored. It will always be 12:15 at the top of 45 West Broadway. Gutting the structure
was incremental: build up, then gut. As Bernard McFarland said “we were gutting the
church building from day one until we were done”.
The main challenge and value-added opportunity occurred at the top of the
building. The McFarland Team was able to save columns, upper archways, some stained
glass, and crown moldings in the premium upstairs units. These units also have cutout
balconies with sweet views of the city skyline.
The project was completed in early 2004, after a construction period of 27 months.
Total construction costs totaled $7.1 million, not counting marketing sales expense or
Insert Site development layout rendering or sketch map and 2-3 photos.
The developer acquired the project with $1 million of his own funds, plus a
private line of credit secured with other projects. The balance of the development funds
came from a construction loan from Andover bank. No historic credits were used, despite
the fact that the building could have been made eligible.
Michael Ecker was a senior loan officer at Andover Bank at the time the deal was
struck in 2001. The construction lender had known James McFarland since about 1990,
and they had a highly satisfactory professional relationship. It was known that the
McFarland team had done lots of housing rehab projects in Boston’s South End, and that
the builder had the skill set and reputation as a low-cost builder. The banker said “if I had
to rank McFarland on a scale of 1-10, he would be a 12”. When McFarland was putting
together the bid package, the lender toured both buildings. The rectory seemed an easy
play, but the Church was overwhelming, with its big empty space. A vision was needed.
The need to cut through the 3 foot granite wall for windows also seemed daunting.
In terms of business risk, the lender was confident McFarland would bring in the
rehab cost numbers low, and that the units could compete well based on that. The lender
also saw considerable upside in the premium penthouse units, and was comforted. The
market risk was not so clear. Boston’s Big Dig was going on. However, the project’s
proximity to the city, highways, and Subway “T” station was persuasive. McFarland also
had done his homework with some appraiser comps, showing market demand at about
$300+ per square foot. The bank wanted no input into project design, and stayed by the
In terms of project phasing, the lender and builder both agreed that the easier
Rectory project should go first. The bank would not advance funds to start the Church
building itself until 75% of the rectory inventory (6 units) were under a purchase and sale
agreement, accompanied by a 5% deposit. McFarland was free to start redeveloping the
church with his own money, if he chose. With respect to loan payback, the bank’s release
fee was based on about 85% of sales price, payable on each sale (Ecker 2008). The
interest rate varied between 9% and 6%, averaging 7%. Total financing costs were
$800,000, or 7.5% of project costs.
Marketing and absorption
The developer initially determined that the project could not support apartments:
market rents were too low. Therefore, he went the residential condo route. As part of the
bid process, an appraiser provided outside sales comps, showing support at about $300-
$350 per square foot.
Two real estate brokerage firms handled marketing of the project. Gibson Domain
Domain (now Sotheby’s) was the firm that marketed the bulk of the market rate units.
Theresa O’Neill sold the 11 affordable units. Both arrangements were exclusive
representation, with a 5% commission: thus there was no developer overhead. All sales
occurred as presales during construction. Marketing/ sales commission costs were 5% of
the $11.7 million project revenues, or $585,000.
Unit absorption was brisk: they sold all units in 18 months, most in the last 9
months. Sales amounts were between $225,000 and $725,000 , with values at $285-415
SF. The buyer profile: 10% young families with small kids, 45% Yuppies couples and
45% Yuppie singles. Religion was not a factor at all. The location and stone building
was the main feature. The majority of buyers came from outside the Boston Metro area.
Project condo fees now average $350 month, exclusive of property taxes. This
includes landscaping, cleaning public areas, all heating and cooling public electric,
maintaining parking lot, and replacement reserve. There is a master meter for gas (for
Financial outcomes: Sources and Uses of Funds, and Developer profit
With respect to uses of funds, total property development costs were $10.6
million, excluding sales expense of $585,000. Property acquisition costs were $2.4
million (23% of project cost), or about $83 per the existing 29,000 building square feet,
but only $46 per final building square footage of 52,000SF. Site prep, including a bit of
asbestos remediation, demolition, parking landscaping, etc, was $115,000, or 1% of
project cost. Gutting the building cost $300,000, or 3% of project cost. Construction hard
costs (excluding acquisition cost) totaled $7.1 million (67% of project costs), or $137 per
building square foot. Soft costs including legal, planning, property appraisal, and
architectural fees were $1.1 million, or 10% of project cost. All in development costs,
excluding marketing, were $204 per building square foot. Including marketing, gross per
square foot costs were $215 per building SF.
The project cleared $515,000 in net profit, a project rate of return of 5%. The
developer also got builder profit on hard costs, and kept two units for investment
purposes. Overall, this deal was excellent for all involved.
The following lessons can be learned from this successful project.
Neighborhood approval was not problematic. No residential abutters (INBY)
meant easy public approval. In the medium run, the Church and rectory rehab was
a positive catalytic project. The area went from no residential abutters to a
considerable amount of residential abutters. This is a good public outcome.
No historic designation meant less red tape, quicker public approvals, fewer
hassles with regulators, and a quicker entry into the market. The project was
timed right, and hit the market window.
Cutting in 3 foot deep windows through solid rock for light was a challenge, but
could be overcome.
Despite the big ticket acquisition cost of $2.4 million (about 23% of project cost),
and need to buy with cash to seller and no option, the market could support the
price. Because McFarland bought a two story building and was able to develop 6
stories, by constructing a building within the Church shell, he essentially bought
@22,000 SF of internal development air rights.
Financially the project was a success, even without the historic preservation
subsidies. The business strategy exemplified vertical integration, with developer,
builder and owner profit available for the winning. The developer still retains
some upside buy owning and renting out a few units.
On their home turf, the Luck of the Irish was with the McFarland team. Since they are
now bringing the six story Allele residential condo project to market on an abutting
parcel south of 45 West Broadway, let’s hope the it holds out a wee bit longer.
Archdiocese of Boston, 2000. Invitation to developers and letter of interest
Ecker, Michael. 2008. Executive Vice President and Senior Lending Officer at River
Bank, North Andover, Mass. Telephone interview, July 1, 2008. (formerly Senior
Lending Officer at Andover Bank).
McFarland, Bernard. 2008. Construction manager, McFarland Development Team.
Personal interview in Boston. MA, June 27, 2008.
McFarland, James. 2008. Lead Developer and Pater Familias, McFarland Development
Team. Personal interview in Boston. MA, June 27, 2008.
U.S. Department of Commerce, Bureau of the Census 2000
Mary Kelleher 617 777 4547. Realtor firstname.lastname@example.org . still waiting to hear back.
BRA Valerie Gingrich 617 722 4300, still waiting to hear back
View of Boston from a penthouse deck
Table 1 Saints PETER AND PAUL Church Project Development Costs
0.82 acre former Church and
Development date 2002-4 FACTORS DOLLAR PERCENT OF
AMOUNT PROJECT COST
lot size (land square feet) 35,700
Floor /area coverage 146%
gross building area 52,000
net usable space (95%) 49,000
# current owners 44
# parking spaces 44
INFORMATION Per Building SF
land/site acquisition (including
option), includes buildings $46.15 $2,400,000 22.64%
acquisition cost per original
building SF $82.76
Remediation: removal of asbestos $10,000 0.09%
other site preparation incl parking $100,000 0.94%
demolition garage building $5,000 0.05%
gutting and building prep $300,000 2.83%
new construction 52,000 SF $128.56 $6,685,000 63.07%
total building hard & acquisition
cost $182.70 $9,500,000 89.62%
Architect, planners, legal,
surveying, $305,000 2.88%
market analysis/ appraisals $5,000 0.05%
subtotal before construction loan $188.65 $9,810,000 92.5%
construction loan/carry 27 months
term, variable rate 7%, int. only $800,000 7.5%
TOTAL DEVELOPMENT COST $204.04 $10,610,000 100.0%
average sales total sales
REVENUES units price/unit revenues
affordable units in Church @700SF
each 11 $ 104,218 $1,146,400
Market units in Church @1000 SF
each 18 $ 230,444 $ 4,148,000
premium units in Church @1700SF 5 $ 582,000 $ 2,910,000
market units in Rectory @1400SF 8 $ 365,300 $ 2,922,400
retained penthouse units @1900SF 2 $ 286,600 $ 573,200
Total Gross sales 44 $11,700,000
Sales expenses fee @5% $ 585,000
net sales proceeds $11,115,000
PROFIT 5% $515,000
gross project profit,