Residence Inn on Newbury Street could become an 88-unit apartment community, giving new owner Torrington a path into the region’s tight housing market
DANVERS, Mass. — A 96-room extended-stay hotel in Danvers has been sold for $13.5 million in a transaction that could ultimately transform the property into an 88-unit apartment community.
JLL Capital Markets announced Thursday that it arranged the sale and acquisition financing for the Residence Inn Boston North Shore/Danvers, located at 51 Newbury St., about 20 miles north of Boston.
Torrington acquired the property from an affiliate of PEG Companies Inc. and plans to initially continue operating the property as a Residence Inn before moving forward with an approved multifamily conversion.
The property’s planned transformation comes as communities across Greater Boston face a shortage of new housing and continued demand for rental units.
The Danvers Zoning Board of Appeals has already approved the conversion of the hotel into 88 multifamily units, providing Torrington with an established regulatory path rather than requiring a new ground-up residential development.
“The North Shore continues to benefit from its position as a high-barrier suburban alternative to Boston, with strong fundamentals supporting both hospitality and residential demand,” said Alan Suzuki, a senior managing director with JLL’s Hotels & Hospitality team.
Torrington, he said, recognized the opportunity to acquire an income-producing hotel while retaining the option to capitalize on the region’s housing shortage and strong rental demand.
Hotel offers head start on residential conversion
Built in 1989 on 4.11 acres, the property is positioned at the intersection of Interstate 95, U.S. Route 1 and Route 128. Its location provides access to Boston, Logan International Airport and communities throughout the North Shore.
The Residence Inn features apartment-style suites with fully equipped kitchens, along with a complimentary breakfast area, fitness center, seasonal outdoor swimming pool and meeting space.
Those features and the property’s existing configuration make the property particularly adaptable to residential use, according to JLL.
The site is also near major retail destinations including Liberty Tree Mall and Northshore Mall, as well as corporate employers and health care facilities throughout the North Shore corridor.
The combination of transportation access, employment centers and retail amenities has helped create demand for both extended-stay lodging and housing in the area.
The property’s existing agreements with its hotel brand and management also give the new owner flexibility to continue operating the Residence Inn or proceed with the approved residential conversion.
North Shore draws interest from hotel and housing investors
JLL said the transaction reflects broader investment trends on the North Shore, where limited development has constrained both hotel and multifamily supply.
According to the brokerage, the North Shore hotel market has added no new hotel supply in the past decade. At the same time, the multifamily market continues to post strong occupancy amid relatively little new construction.
For Torrington, the approved conversion provides an opportunity to repurpose an existing property rather than undertake a new apartment development from the ground up — a potentially significant advantage in a market where housing development can face high costs and lengthy approval processes.
JLL represented the seller in the transaction and also arranged acquisition financing for Torrington.
The JLL team involved in the deal included Hotels & Hospitality Senior Managing Director Alan Suzuki and Managing Director Matthew Enright, along with Managing Directors John Flaherty and Jon Bryant, Associates Michael Schwarze and Anthony Nakhle, and members of the firm’s Debt Advisory team: Directors Michael Shepard and Ryan Parker and Associate Hunter Cuthbertson.
For now, the Residence Inn will continue serving hotel guests. But if Torrington follows through on its plans, the property could eventually trade hotel rooms for apartments, adding 88 residential units to Danvers and offering a new example of how existing hospitality properties can be repositioned to address Greater Boston’s housing needs.
