Beyond Running Shoes with Keith Craig, Senior Director of Development of NB Development Group

New Balance has made an indelible footprint not only in fashion and sports but also in the real estate sector. Keith Craig, Senior Director of Development of NB Development Group, takes us through the milestones of how NB Development Group transformed the once-industrial area of Allston-Brighton into a vibrant destination for music, dining, entertainment, and life sciences. Speaking of all-stars, Boston Landing is also home to what might be the world’s fastest track and the training and practice facilities for the Boston Bruins and Celtics – an all-around win for Boston’s many fans and visitors!

The “Distinguished” podcast is produced by Boston University School of Hospitality Administration.

Host: Arun Upneja, Dean
Producer: Mara Littman, Director of Corporate and Public Relations
Sound Engineer and Editor: Andrew Hallock
Graphic Design: Rachel Hamlin, Marketing Manager

Music: “Airport Lounge" Kevin MacLeod (incompetech.com)
Licensed under Creative Commons: By Attribution 4.0 License
http://creativecommons.org/licenses/by/4.0

Transcript

Arun: Welcome to the Distinguished Podcast, produced by Boston University School of Hospitality Administration. I am Arun Upneja, Dean of the school, and today I am pleased to welcome our guest, Keith Craig, Senior Director of Development at the NB Development Group. As part of the senior management team, Keith is responsible for all aspects of development, including strategy, financial analysis, programming and design, and project execution. Keith, you've been a guest speaker in our real estate courses, providing mentorship and field expertise to our students. Welcome back to Shaw, and thank you for joining us for the Distinguished podcast.

Keith: Thank you, Dean.

Arun: So first, let's start with the basics. How did you get into real estate?

Keith: Yeah, thank you. I, yeah, so I'm from Canada. Grew up in a fairly rural area of central Alberta, went to university in Alberta, and hadn't really started traveling much until my early 20s. And so as I started to travel, starts to see bigger cities in the US and across the world. I recognized that I had an interest in what I would later understand is urban planning, right? So starting to think about how you affect change and manage growth, you know, through the built environment. So I picked a grad school in Nova Scotia, attended grad school studying urban and rural planning. I made my way, you know, one summer in the early 2000s down to Boston. I hadn't really spent much time in a big US city, so it was kind of a really new great experience working in planning. And through my work over the next several years, I worked on projects where I had a piece of, you know, a development project, right? So, thinking about the initial planning, the entitlements, the permitting. But what I realized was there this whole range of other things going on here, you know, obviously construction and financing, property operations, leasing, all of these things that as you build a building and then you open it, that you have to accomplish in order for that to be successful.

And what I found was that my interests were more aligned with, you know, kind of seeing how all these things happen. So, I started to get more involved in the real estate side, development side of it. And then about 12 years ago, I ended up at NB Development Group. And, you know, we at the time didn't know that it would turn into what it's turned into, kind of a multi-phase, multi-project, multi-year development plan. And, you know, what I've realized that I really like is, you know, working on a project like this, is that there's this vision, there's kind of a larger mission, and all that, I think, ties back to my interest in kind of the urban planning side of it. You know, how things work, how you manage all of these pieces of the puzzle as cities grow and change.

Arun: It's very interesting that you grew up in Alberta and then learned urban planning in Nova Scotia. Both of those are not known for their urban centers.

Keith: Sure, that's true, yeah, very, very kind of smaller in terms of density, but obviously very large kind of suburban cities. Yeah, so just a different thing. And that's probably why I don't live there anymore, right? You can't. Tracked into these kind of big, messy cities that are just fascinating.

Arun: So you mentioned NB Development Group, which stands for New Balance Development, the sneaker company, which I've been told are seeing a resurgence in sales and they've become very trendy. But I want to focus on the NB Development Group. So can you sort of describe how that group started and what does it do?

Keith: So that group specifically, we started back in 2011, which I started back then, July 2011. There was a property group that always existed before that. New Balance has been in that immediate neighborhood in Brighton for over 50 years since our owner, Jim Davis, has owned New Balance Athletics. He's had three headquarters there over that time period. And so it kind of coincided with a pretty concerted effort at growing the company. And so what the immediate need was, was to grow into a new building. You know, they were at a building on site there, which was your kind of typical commercial office building. He wanted kind of that campus feel. He wanted, you know, to really attract the best and the brightest to come work for him. He realized that he needed to grow. And he happened to be in an area that was very underutilized, you know, kind of a swath of land that was industrial, light industrial, starting to, you know, have some change, kind of development started to really increase during that time coming out of the 2008 recession. And so he saw an opportunity there to kind of capture that. There was an ongoing proposal for a big box retail store. And he, you know, looking out his window one day said, you know, I don't want that as my neighbor. And so he put a little small team of us together and we started to buy some of the land and figure out how to take the first step into kind of this, this master plan, which, you know, we started to evolve in the early 2010s.

Arun: So until that time, New Balance was not buying all the surrounding areas. It's only post 2010. And I'm assuming that was a good time when the property prices were still down to sort of start expanding and buying up the, you know, land around the area.

Keith: Very correct. Yeah. So over the course of a few years, he was able to capture about 15 acres. And again, you know, these are all older industrial kind of not nice neighborhood uses, not good neighbors. The street there, Guest Street, was, you know, just a two-lane road, no sidewalks. And it was where the local car dealership would kind of test their cars on. So it was really kind of a forgotten area that, you know, needed some planning and needed some change.

Arun: So far, you've been in NB Development is that's where you're focused in on Alston and Brighton neighborhoods. So can you sort of describe over the last 15, 20 years, what has the change been in that neighborhood and what is the vision for future growth?

Keith: Alston Brighton, its history has typically been because of its location, because of its neighbors, transient, a lot of students. You've got probably the at that time, the lowest owner-occupied housing in the city, probably somewhere in the 20% range. So a lot of rental housing for students and grad students and teachers. And I think because of that, you've got a lot of older housing stock, little incentive to build new. So not a lot of change in terms of the housing availability. And then you've got these three powerful educational institutions, Harvard, BC and BU kind of triangulated in the neighborhood at each of the corners. So that's kind of been its history. Albeit a very engaged citizenry, very active in, as much as it can be, in kind of the local politics, the local economy. And I think, fast forward to now, 2023 and looking forward, you have seen, partly because of what we've done, but partly because of the strong economy and other changes in the city, you've seen a lot of development, you've seen thousands of new units created in the neighborhood, either built under construction or proposed.

Those are both ownership and rental. You've seen a diversity of new lab space, new office space, new retail and restaurants, not only in the areas that are growing, but also along some of the main street areas. That translates into new jobs, it translates into general convenience for people, having things closer to where they live, so they're not commuting like all of us do in some way. I'm very positive about the future in the neighborhood. Change is good and certainly there is a lot of change. I think with those strong institutions, there's always that inherent town gown conflict. There are a lot of impacts with having institutions in your neighborhood, and I think residents have gotten much better and are much more skilled at working with institutions to make sure that they do get the benefits that come along with being neighbors to these powerful schools.

Arun: Right. I want to get into the town and gown relationship, but before that I wanted to just sort of point out that NB Development Group, the way you have developed that is more of a mixed-use real estate development. And so how do you define mixed use and what are the benefits of it?

Keith: Yes, I think all new large-scale development in the city ends up being mixed use. We're certainly a good example of it. Other developments like North Point, Cambridge, and Assembly Row in Somerville, though much bigger, obviously are very mixed use. At Boston Landing, we have lab, office, residential, a mix of retail and restaurants. We've got a future hotel coming. I think what separates us a little bit is that because of New Balance, we've got that sports and fitness piece with the Boston Bruins, the Boston Celtics, a track and multi-sport facility. And then we've also brought live music there with Roadrunner, a 3,500-person venue, which again is another piece to really create a destination, which I think a lot of these larger developments are trying to do. And that mixed-use nature is kind of what allows obviously all that to happen. But I think what makes a success to some of these new developments are that you kind of have to, you have to kind of define a place and make it really legible, right?

And you do that not with the buildings you're building, but you do that with the streetscape. You do that with a strong pedestrian experience, nice streets, bike lanes, wide sidewalks, street furniture, street trees, open space opportunities, all of these things that help define how you and I experience the place. I think that's really what makes an area successful. When you think about all the places that you want to enjoy, we might think of places in the Back Bay, we might think of places in New York City like Greenwich Village or places in Washington, DC. And in some of those places that you experience where you're walking, it's because of all of these elements that they're really interesting places to be, and they have very pedestrian-friendly environments.

Arun: Right. You know, it's very interesting. You know, you described the music venue, the hotel, the ice arena, and all these different things that you're blending, the music and fitness and labs and sports, which is the complete opposite of an office park where you just have rows and rows and, you know, deep office buildings. And I think the pandemic sort of has outlined the shortcomings of that approach, and now no one is going to the offices anymore. And so this mixed-use development which you started way before the pandemic seems to be what is going to be the norm of the future.

Keith: I think 2023 will be that change. You'll start to see that it's three or four days a week that people will be in the office, not because they have to, I think because they might want to be. Coming out of COVID, I think obviously we've all learned a lot of things. Having New Balance as our primary sponsor, right, kind of the major tenet here, kind of all things permeate New Balance. It's been easy to attract those other like-minded companies, athletic teams, people young and old. Jim Davis, he wanted this place, as I mentioned, to be a destination. He wanted it to be unlike anything else there is around. So we needed a broad range of things, a broad range of uses and attractions for that to happen.

Arun: My question is, how did you engage? So first of all, I'm assuming that engaging with the communities or the neighborhoods and engaging with the town are one and the same thing. Is that true or you engage with them as two different sets of stakeholders?

Keith: Yeah, I think you do it together. I think the city and the Boston Planning and Development Agency, you know, all the city departments, I think, you know, kind of that has a process and those are conversations that you need to have. I think it's aligned with, you know, at times and depending on where you are in your process with your relationships with, you know, your neighbors, your butters, kind of the community groups that are strong in Austin Brighton and then your elected officials on the local and the state levels. You know, and all of those conversations are really important ones. The history of that immediate area was a strong one. It was a job generator. It was quite an important piece of the neighborhood. It was rail yards for a long time before that. It was stockyards and, you know, where a lot of cattle were. So again, it was part of the economy. And as each of those economies moved on and moved out of the city, obviously the area stagnated. So there were no neighbors, you know, residents in the area, especially around the area, wanted change.

They wanted things to improve. And I think they liked New Balance's commitment to the neighborhood, right? That it wasn't a company that was looking to move away, wanted to stay and wanted to become stronger and wanted to grow. So they liked that commitment. I think as a developer, as someone that's causing change, you know, we talked about the neighbors, community groups, like the officials, you got to start those conversations early. You have to, you know, meet and talk often. So I think, you know, that's really kind of lesson one in that, I think. And as you're having those things, obviously, they're not always easy conversations. There's a lot of challenging conversations because you're trying to understand what the issues are in the neighborhood. And hopefully you can, you know, directly make change to those issues. So I think, you know, lesson two in that is that you need to do what you say you're going to do. So it's not just that you're hearing them. It's that you're going to help them resolve some of those issues. And then lesson three, kind of a subset of that is that you're hearing these problems, whether it's traffic or the environment or any myriad of housing issues, that you're going to solve those problems. You might not solve all of them, but you might solve some of them.

So a good example of this is that from the very beginning, we knew that public transportation was an issue in this neighborhood. Really all you have is pieces of the green line, which we know is a valuable resource for everybody, but it's also not the best means of rail transportation. And this neighborhood had really good commuter rail service back in the 50s and 60s. Once the Mass Turnpike was extended into downtown, it kind of squeezed the width for commuter rail and commuter rail was removed. So there has always been that goal of how do you get this back? And the state has always had plans to return commuter rail to the neighborhood. But again, they have their own problems and this wasn't a priority. So we knew that we needed to help with that. We took on the responsibility for designing it and for building it and for funding 75% of it. So we worked closely with all of our state partners, MBTA, MassDOT, Kiolis, all the elected officials. And we started construction in 2015 and we opened it in May of 2017. So you think about that for a second, right? 2012, 2017, five years to us, which just seemed like an eternity and not knowing until that last year if we were going to be successful at it. But when you think about big public infrastructure projects, kind of those groundbreaking things where you involve multiple stakeholders, five years really isn't that long, right? It's not a long time when you kind of are bringing a service like that to an area, to a neighborhood.

And what we learned was not only, you know, obviously our selfish goal was to provide another transportation choice for people to come to Boston Landing for work, for to live, whatever, but what we realized in the first year of operations of that station is that it wasn't us that was getting the benefit. It was the neighborhood that there was this really latent need for another transportation choice. So kind of a fascinating piece of information is that we knew that the state had a year 2030 goal of 1200 riders a day using a future station, right? So our station. We achieved that 1200 riders within the first year. So in 2018, we already were, you know, above 1200 riders a day, 12 years ahead of that goal. I mean, that's just a huge success, right? And then for us, benefit to us was as that station started to come out of the ground, as people could see that this was real and that one day it was going to open, we had a building, 80 Guest Street, which is the building attached to Warrior. It was, we built that on spec, which means we didn't have a tenant before we started construction, finished the building, still had no tenant. And once people saw that the train station was real, we were completely fully leased, 100% leased within one year. So again, you know, it kind of proves if you build it, they will come and that people's desire to get out of their cars and have choice for how they commute and live and travel is real.

Arun: Well, it is certainly true if you build it, they come, as long as it's in the right place and the right product. And you seem to have hit the nail on the head with that if you were ten years ahead of your ridership goals. I want to pivot a little bit to climate change, since you have been so forward thinking in terms of, you know, way ahead of times, in terms of creating that sustainability has obviously become a very big goal in our communities and our society.

Keith: Clearly, anybody building new buildings in the city today, you know, wants to be sustainable. It's good for everybody. It's good for the tenants. It's good for their electrical costs. It's good. So, you know, the three things at Boston Landing that I think have, you know, kind of are our highlights. You know, one I think is brownfield sites. So, talked about most of Boston Landing was industrial, light industrial uses, you know, dirty, dirtier uses. So, what you're left with is soil that needs to be remediated and taken care of. And so, we've had to do a lot of that. You know, we talked a lot about a few minutes ago just about the train station. I think, you know, you might not think of that as sustainability, but obviously it is, right? It's getting people out of their single occupancy vehicles, providing choice for people. So, that's a huge sustainable effort. And then lastly, I think one of the things we're kind of really most proud of is, you know, the track and field building that we just built has what I believe to be the largest rooftop solar installation in the city.

It's about 1.75 acres of solar panels, about 2,400 panels on the roof, massive four-acre site, an enormous south-facing roof. You know, so we are producing about 1.2 million kilowatt hours a year, which we hope will fully offset the electrical usage of that building. So kind of good for us, I guess, to have that. But you know, kind of a nice story there.

Arun: And I agree, the train station is important because, you know, when you get people out of these single occupancy vehicles, it's always a plus. So I want to turn to you personally, and I want to ask you, what is the most exciting and invigorating part of your work and what are you most proud of?

Keith: Yeah, I think kind of tie this back to the first part that we talked about, which, you know, how I got into real estate development. I think seeing a project through, right, kind of from concept to completion and seeing a building opening, you know, that process is a messy process. Every day is different. There's issues every day that make for challenging and rewarding work. I think probably in all of our work, there's very little opportunity, or we all may not take the opportunity to celebrate kind of our achievements, how little or big they may be. But, you know, in some of the work that I've done here, that we've done here, NB Development, is you have these moments in time where you have a groundbreaking, or you have an opening, or you have a topping-off ceremony for the steelworkers. And I think those are the moments that you learn to kind of, wow, okay, this is a great day, right? Look what we've accomplished together. You know, the team, the broad team with all your designers and engineers and contractors, neighborhood partners. It's kind of a fun thing, and it's a good day. It's a happy day. You know, Jim Davis is kind of our sponsor of all of this, helping him achieve his legacy and his goals. You know, I think it's pretty rewarding that, you know, he can look back and say, you know, look what we've done together. So to have been a part of that is obviously very rewarding.

Arun: Fantastic. So, Keith, for a little fun, we want to wrap up this edition with a speed round of questions to learn more about you. What's your ideal vacation spot?

Keith: So, that's a good one, actually. You know, my wife and I and son, you know, we do like to see things. We love kind of driving, walking, hiking, all of those things. But the joke my wife always tells me is that I only will go on cold vacations. So, you know, Iceland, Scotland, Ireland, Canada, all of, you know, Europe, wherever. And she's a product of most of her adult life of coming from the south. And she likes things hot. And I'm on the exact opposites.

Arun: What was your first job and what was one thing you learned from your experience?

Keith: So, I've had a lot of jobs. I've been working in some capacity probably since I was a younger teenager. So, that's kind of a hard question. But I think I also had an eclectic mix of employment. So, three things I might say is I spent a few years in the Canadian military, which was a fascinating time in my early 20s. I traveled and spent some time working in England where I worked to set up big top tents for big events, a laborer setting up tents.

And then I also worked in Northern Alberta and Canada working on oil rigs as a rig worker. So, a very diverse, not particularly useful when you're talking urban planning and real estate development. But I think what you learn from those experiences is that you need to be able to communicate well and you need to be able to work as a team.

Because in all of those examples, if you don't, someone's going to get hurt. So, I think that's probably the most important thing I've learned.

Arun: What's your favorite TV show?

Keith: Funny, from my wife. She'll tell me that if I see any of the Jason Bourne series or the Band of Brothers series on TV, I cannot but watch it. 

That's an action act. Yeah, I'm Jason Bourne and all the series and everything around them. Arun: Lastly, what type of music do you like?

Keith: Yeah, a few months ago I saw a band called The National, which is kind of a rock alternative band from Ohio via Brooklyn. So I think it's kind of singer-songwriter rock. Maybe I could say also most anything Canadian except perhaps Rush.

Arun: When you go to that venue, do you look up and you can see your features of the whole building. Does that ever come in your way that I put that beam there, I put that feature in there for this purpose or are you able to enjoy the music?

Keith: Yeah, kind of the one thing that I do think about, I think anybody from our team that's in there, is that because the building is such a jigsaw puzzle and there's so many volumes within the building and a diversity of uses and events is that we were really careful at kind of the sound impact of each of those users. So making sure that we planned and designed in kind of all of the sound attenuation to prevent another user from experiencing an event that they're not actually at.

Arun: Keith, it has been an absolute pleasure to have you on the Distinguished podcast. Thank you.

Keith: Thanks, Arun. 

Arun: And thank you everyone for joining us today. Special thanks to the team who produces this podcast, Mara Littman, Andy Hallock, and the entire team at Boston University School of Hospitality Administration. To keep up with Distinguished podcasts, be sure to subscribe wherever you listen to your favorite podcast. You can also learn more about our undergraduate and graduate programs at Boston University School of Hospitality Administration by visiting bu.edu/hospitality.