VOLUME 13, NO. 3     June 2001

WPI invests in a new gateway to Worcester

With a new partnership with the Worcester Business Development Corporation and private developer Greg Kerkorian, WPI is opening a new gateway to the campus and to the city of Worcester. Operating as Gateway Partners LLC, the three entities joined forces in December 1999 to purchase approximately 13 acres in the area of Prescott and Grove streets that includes 60, 68, 72 and 75 Grove St. and the Ziff’s Paperworld building at 30 Prescott St. Last October, WPI entered into another partnership that provided minority ownership of three additional Prescott Street buildings, including No. 85, the home of the Massachusetts Lottery Commission.

"In the next decade or more, WPI and its partners expect to fully develop the area and create a true gateway to the city from what was once a deteriorating and somewhat polluted former manufacturing area," says Stephen J. Hebert, vice president for administration, who describes it as "exciting new commercial real estate for the city." A master plan is being developed for this area, which is less than a 10-minute walk from the current campus.

"These real estate investments are part of WPI’s endowment portfolio," says Hebert. "Our new holdings will enable us to provide overflow parking and space for expansion, including a possible major research center now under consideration." Some changes are already under way. E-Source Mortgage and the Medical Records Bureau recently moved into renovated quarters at 85 Prescott St., the Massachusetts Academy of Mathematics and Science will relocate there this summer, and WPI’s Manufacturing Assistance Center is situated at 60 Prescott St. A building at 89 Prescott was demolished to make way for a parking lot.

"Ultimately, we plan to use some of the buildings for manufacturing purposes and redevelop the entire parcel for the benefit of the city, the region and WPI," explains Hebert. "While the rehabilitation of these old buildings is not without challenges, we believe we have made an excellent investment. These parcels are truly the gateway to Worcester. They comprise one of the few remaining tracts available for new or expanding businesses. They offer easy access to Route 290, a Courtyard by Marriott is at the center of the properties, and the view down Worcester Center Boulevard is evidence of the revitalization of the city. Interest in this area is high."

The Prescott/Grove streets properties are a significant addition to WPI’s other real estate holdings, which include about 40 neighborhood buildings. Most are open-market rental units. WPI also owns Salisbury Estates, a 109-unit apartment complex on Park Avenue, and the recently acquired Bernstein apartment building at 32 Boynton St., which contains a total of 24 apartments. Almost all of these properties are fully taxed by the city of Worcester.

"While real estate is only a small part of our total endowment portfolio, we believe that this investment will perform very nicely for us in the months and years ahead," says Hebert. "With the addition of the Gateway properties, WPI and its partners are positioned to make a significant contribution to the improvement of the tax base and the economy of the city."