PEABODY — Almost overnight, a Woburn real estate investment management company has become a major player in the city's rapidly changing downtown.
ViceRoy Capital Management announced Aug. 28 it acquired an 11-building mix of 149 residential and retail units for $17.2 million, making it one of the largest property owners, if not the largest, in downtown Peabody.
The sale includes the iconic Peabody Square corner of 2 Main St., which together with two fenced in lots on Littles Lane, fetched $2.8 million, according to the Southern Essex Registry of Deeds.
The sale involved the following properties: 2, 77, 65, 61 and 55 Main St., 2, 4, 6, 3 and 3½ Littles Lane and 28 Lowell St. A majority of the properties are clustered around Main Street and Littles Lane, with a couple located in Peabody Square.
The residential units are being described as "workforce housing," and they include single-room occupancy units, studio, one-bedroom and two-bedroom apartments. The sale also involved 15 retail spaces.
There are five multifamily apartment buildings on Littles Lane, a narrow residential street just off Main Street. The sale also includes two fenced-in lots on Littles Lane.
ViceRoy Capital Management took out an ad in The Salem News International Festival section on Aug. 29 stating that it was "proudly supporting our local neighborhood," while listing some of the businesses that have become a part of its retail portfolio: Dance with Dena, Top Nails Salon, Maria's Flowers & Gifts, Breaking Grounds Cafe, Create & Escape, Brazcom Wireless, The NexMex Thing, Granite Coast Brewing, Sports Collectibles, Peabody Insurance Agency, Teddy & Peter Hairstyles and Boston Smoke Shop.
One of ViceRoy Capital Management's managing partners, Carl Valeri, said the former owners "did an awful lot of work" after owning the properties for almost five years. Valeri said his company is planning on updating common areas and attracting more commercial tenants.
While they do not have any new retail tenants in mind, they are hoping to attract more restaurants, including an eatery that serves breakfast and lunch. They also plan on facade improvements, and he noted some new awnings were going up earlier this week.
"It's great working-class product," Valeri said of the housing. "This is the definition of workforce housing."
Nearly 80% of the 134 residential units have been renovated, according to the commercial real estate firm Horvath & Tremblay, which has an office in Lynnfield and whose Senior Vice President Dennis Kelleher, Senior Vice President John Pentore and Associate Stephen Girolamo brokered the sale.
Valeri said what attracted him to invest in downtown Peabody was "it's clearly on the rise."
The city, Valeri said, has a young mayor who "wants to see nothing but the right things for the community."
Peabody has some good, long-term plans and the company wants to be part of them, he said.
"I'm really pleased with the positive steps we are taking with our downtown revitalization," Bettencourt said in a text message. "New restaurants and new businesses are filling long vacant spaces. People are taking notice. I'm looking forward to working with ViceRoy and partnering on our joint vision for the next steps."
In March 2015, Norman Lee, James Gebo and Shawn Farrell, partners in Northfield Properties LLC, were described in The Salem News as the largest residential landowners downtown when they acquired 14 parcels from the Gordon Family for $8.3 million.
Included in that earlier sale was the building that houses Brodie's Pub at 10 Lowell St. The city acquired the property for $425,000 in February 2018, with plans to turn the land into a city park.
The former Gordon Realty properties also included a former 1912 theater building at 43 Main St. that is now home to a brand new event space Olio and the Maki Sushi restaurant. This sold in October 2018 for $550,000, according to city records. This building has undergone a $1 million renovation.
In addition, the residential building at 28 Lowell St. was not part of the properties the partners acquired from Gordon, but that was acquired later, said Horvath & Tremblay's Kelleher, who said the former owners spent several million dollars fixing up the properties.
"They did a lot of heavy lifting on the assets and it shows," said Kelleher, adding the properties generated a lot of interest among potential buyers, and the sellers provided a blueprint on what could be accomplished downtown.
When asked why they were selling the portfolio, Kelleher said the partners saw other opportunities that the wanted to pursue elsewhere.
The sellers played a big part in the revitalization of downtown Peabody, with new businesses such as Granite Coast Brewing, The NexMex Thing and Breaking Grounds Cafe, which is operated by Northeast Arc as place to train those with intellectual disabilities in the food service industry.
Shawn Farrell said he and his partners were thankful to the mayor, the city and the Community Development Authority for their support. Initially, the partners obtained a $1.8 million gap loan from the Community Development Authority while they put together the main financing plan for the purchase.
"We are just extremely thankful for just being blessed to work with very great people with the city," said Farrell, who said they did a lot of work on the properties, and now it's time to pass the torch.
"There are opportunities to do more of the same elsewhere," Farrell said.
Staff writer Ethan Forman can be reached at 978-338-2673, by email at firstname.lastname@example.org or on Twitter at @TannerSalemNews.
Here is a snapshot of the sale of properties in downtown Peabody and the Square
|Properties||Residential units||Retail units|
|77 Main St.||16||2 (Granite Coast Brewing, The NexMex Thing|
|65 Main St.||33||4 (Breaking Grounds, Brazcom Wireless, Create & Escape)|
|61 Main St.||8||2 (Top's Nail Salon, Maria's Flowers & Gifts)|
|55 Main St.||13||1 (Dance with Dena)|
|2, 4, 6 Littles Lane||18||0|
|3 Littles Lane||6||0|
|3½ Littles Lane||3||0|
|2 Main St.||26||6 (Sports Collectibles, Sports Gallery, Peabody Insurance, Teddy & Peter Hairstyles, Kitchen Design Consultants, Boston Smoke Shop)|
|28 Lowell St.||11||0|