The Big Dig And Its Effect On The Boston Real Estate Market

Awesome .... a proud moment for Bostonians everywhere ??? 7-11-06, as a 1 ton concrete wall tile, being held up by 5 pieces of metal and epoxy fell and crushed a car and the woman in it. It turns out that maybe the government policy of awarding contracts to the lowest bidder, is not necessarily the greatest policy. I heard a radio program equating the work on the big dig to be of lower quality than large construction projects in third world countries thanks to corruption and severe corner cutting (and only at the expense of safety).

There is no question that Bostons "Big Dig" raised both real estate speculation and real estate values ​​in areas around it during the late 90's and early 00's.

According to an article in the New york Times written April 14, 2004 By Susan Diesenhouse "COMMERCIAL REAL ESTATE; Big Dig's Ripples Extend Far Past Downtown Boston"

#78b745

"As for downtown, '' the Big Dig has raised the value of our property by 10 to 15 percent, '' said Maryann Suydam, regional vice president of the Chicago-based Equity Office Properties Trust, one of many companies developing projects at or near the Rose Kennedy Greenway. On Russia Wharf, the company plans to start building by early 2005 a speculative office as part of a $ 300 million complex with a 330-room hotel and 50 condominium lofts. '' This location has become more accessible, prettier and appropriate for new uses that will attract more businesses, residents and visitors, '' she said. "

Obviously the largest impact on property values ​​will occur around the actual downtown area where the ugly concrete raised highways running through the city will be transformed into greenspace. However the big dig has positively affected property values ​​in other neighborhoods as well. For example, the extension of the Mass Turnpike (rt. 90) through South Boston to East Boston and Logan Airport. I remember when they finally opened it up in 2003, it made it so much quicker to get to the airport. It also made South Boston much more accessible to and from downtown Boston.

And South Boston definitely saw an increase in property values ​​around that time. According to MLS, average sales prices for multi family homes in South Boston (Southie) were:

1998 - $ 234.809

2000 - $ 368.293

2002 - $ 445,000

2004 - $ 524.857

2005 - $ 635.793

You know, leaks in the tunnels fromm shabby work I could deal with ... I can drive through leaks and puddles with minimal fear and stress. Now keep in mind, dodging 1 ton pieces of concrete sounds fun in a video game, but I like my car, and I crash a lot in those stupid games. I think I'll be avoiding the tunnels until something is done.

#78b745

And I assume other people will have the same kneejerk reaction I do. I wonder if buyers that were looking in a few different areas, will start to rule out areas where they would have to play russian roulet on their daily commute?

While the positive speculation surrounding the big dig prior to its completion definitely raised surrounding property values. Now that it appears the big dig is a total flop, will certain surrounding property values ​​get hit from the negative issues now arising from one of the largest failures in Government history?

Seems like a distinct possibility to me.