0 Office Rent Increases Expected in Prime Boston Locations

Posted on November 6, 2014 by Wil Catlin

If you need more space or if your lease is near the end of the term, now is the time to secure office space in Boston. Buildings are trading hands and the new owners will be looking for a return on their investment and will push rents. In 2007 when Blackstone bought Equity, rents rose 44 percent and other landlords followed suit.

A report on nerej suggests an optimistic future for landlords; “all signs are in place for another major rent move rivaling The Blackstone Effect of 2007. As of Q2 2014 when everything started, vacancy for class A and B buildings in core downtown Boston (defined as Back Bay, Seaport and CBD) was at 8.4%. In Q4 2006, vacancy was at 8.3%. In Q2 2014 average rent for Boston’s core downtown market was $50.32 per s/f; this is $8.56 per s/f higher than Q4 2006…The momentum in the market is similar to 2007. Based on 2007 actual experience, and a move similar to 2007, it would be reasonable to see a “rent pop” up to the $70 per s/f level for core assets. 2007 peaked at $60.15 per s/f. 2015-2016 should add another $10 per s/f, which would result in average rent of $70.15 per s/f during the next 2 years.”

More information is available on the nerej website, here.

0 100 Cambridge Street Goes up for Sale

Posted on November 6, 2014 by Wil Catlin

Looking for an office tower downtown to buy? The Commonwealth of Massachusetts is selling 100 Cambridge Street and looking to capitalize on the high prices that are being paid for Class A buildings around Boston.

Credit: Boston Globe

The building is:
·         22 Stories
·         565,157 Rentable Square Feet
·         Built in 1965
·         Renovated in 2004
·         Typical floor size is 22,255 Rentable Square Feet

Some of the buildings tenants re:
·         Department of Revenue
·         Prince Lobel Tye LLP
·         Miller Wachman LLP
·         Mass General
·         Penn Mutual Life Insurance Company

Marty Jones, chief executive of MassDevelopment, commented in a Boston Globe article that the “state-owned building is not a development opportunity, but she said it should prove attractive to buyers because of steadily rising office rents in downtown Boston. Built in 1965, the tower, formerly known as the Leverett A. Saltonstall Office Building, fell into disrepair and was gutted by MassDevelopment in 1999. The agency added 75 condominiums at the base of the building, along with 25,000 square feet of retail stores.”

You can read the full article on the Boston Globe’s website.

0 Defining Boston’s Seaport District

Posted on November 6, 2014 by Wil Catlin

Credit: BBJ

The Seaport, formerly known as the South Boston Waterfront has not only evolved, but arrived. Interestingly it is not as clearly defined geographically as one might think. One border is the Fort Point Channel and another is Boston Harbor. Beyond that, it is up to some interpretation.

According to CoStar, the border continues to West 2nd Street and East 2nd Street. The core of the Seaport in my opinion consists of: Summer Street, Congress Street and Seaport Boulevard and the various intersecting streets. The Boston Design Center, Convention Center and Wormwood Street would also be included.

The Boston Business Journal quantifies the growth, noting, the Seaport District “already has a population bigger than Beacon Hill’s, and more radical change is on the short-term horizon. Some of the region’s most experienced developers are pushing forward projects that within three years should create more than 2,500 housing units. City planners see another doubling in housing stock, to 10,000 units, by 2030.

0 Christian Science Parcel Bought for $22M and Heavy Restrictions

Posted on November 6, 2014 by Wil Catlin

Credit: ChristianScience.com

Development opportunities continue in Back Bay with some interesting restrictions from sellers.

According to a report on the BBJ, “the Church Realty Trust, which administers property for the First Church of Christ Scientist, dictated in a deed conveying a parcel at 30 Dalton St. to developers that the land was subject to long-term use restrictions that reflect Christian Science teaching around alcohol sales, pornography and, to a limited extent, medical practices.”

Additional details are available on the Boston Business Journal, here.

0 Is Speculative Development Fit to Take Off in Boston?

Posted on November 6, 2014 by Wil Catlin

Office building at 111 Huntington Avenue in Boston

The office market has clearly shifted from years past. We are seeing continued rent growth in all Boston office markets from Back Bay to the Seaport and Financial District. The time has arrived for speculative new office construction. Tenants are willing to pay for brand new construction that accommodates their culture and growth.

From Banker and Tradesman:

“’You’re hearing rumblings in the market about people starting to think about spec office development,’ said Carlos Febres-Mazzei, a senior vice president at CBRE/New England. Typically, speculative development takes off when vacancy rates fall to around 8 percent. With current construction costs, rents need to approach $70 a square foot to support ground-up development, said Febres-Mazzei said.”

0 Office Space Boom in Boston Area Suburbs

Posted on October 26, 2014 by Wil Catlin

new office building in Needham for TripAdvisor

Credit: Boston Globe

The greater Boston economy is strong with jobs, construction and capital. Many office users are seeking value while trying to straddle the live-work-play model for their staff. Not every company can be located within a five-minute walk of South Station, nor can they offer free parking to their employees. What we are seeing is locations that offer infrastructure, reap the benefits of today’s strong office market.

A recent Boston Globe article remarked, “the western suburbs around Route 128 are experiencing a building boom, with new headquarters for growing companies such as TripAdvisor and Vistaprint among five huge developments under construction in Needham, Waltham, and neighboring towns…The attractions of the suburbs include much lower rents and lots of choices. Moreover, the workspaces — either new or newly renovated — are far from the souless corporate boxes of the 1980s that dotted the suburban landscape. The interiors of some new offices look as if they could comfortably fit along Seaport Boulevard in Boston or Broadway in Cambridge.”

Jump over to the Globe’s website for its full article.

0 Office Trends Among Boston Law Firms

Posted on October 26, 2014 by Wil Catlin

Credit: Cannon Design

Boston, compared to our peers, has some of the most efficient lawyers. Boston law firms only occupy about 10 percent of the high end, Class A, real estate in the city. Other cities those numbers range from 25 percent to 42 percent.

The BBJ has strewn together a ‘snapshot of office space trends’ among Boston law firms. The article remarks of the office environment in Boston, noting “legal employment is still down about 2,600 jobs from pre-recession numbers.”

The full article, containing a list of law firm office trends in Boston, is available on the Boston Business Journal’s website.

0 Boston is one of Uber Health’s Test Markets

Posted on October 26, 2014 by Wil Catlin

From car service, to ice cream, to Flu Shots; click on your Uber App for all? Boston is one of the test markets for Uber Health, along with New York and Washington D.C.

Now your Flu shot will come to you, based on where you are, and provide up to 10 shots for your coworkers.

From the Boston Business Journal:

“Uber is testing its UberHealth service…in partnership with Vaccine Finder, a free vaccine search tool developed in part by Boston Children’s Hospital. For every shot given, the company said it would donate $5 to the Red Cross to support vaccination efforts for children including its Measles & Rubella Initiati.”

0 Office Market ‘As Good as it Gets’

Posted on October 26, 2014 by Wil Catlin

Credit: CoStar

If you need office space or are looking to expand or renew at your existing location, consider now. The market is clearly in favor of the landlord and is expected to continue in that direction. Investors are reaping the benefits, while tenants are looking for options with competitive rents.

Hans Nordby, managing director of CoStar Portfolio Strategy, described the commercial real estate environment as “the prettiest picture you’re likely to see in this economic cycle. If you’re waiting for ‘as good as it gets,’ it’s probably today in terms of year-over-year office employment growth being so pervasive.”

Boston office tenants absorbed over 350,000 sf of space in the 3rd quarter, lowering vacancy to just over 10 percent. Class A rents rose to $51.80 per SF.

Additional information on the national market are available on CoStar.com.

0 ‘Cool Offices’ are Casual, Communal and Homey

Posted on October 23, 2014 by Wil Catlin

The office look and feel is vastly different than 10 years ago. Gone are bland impersonal spaces, now we see cozy kitchens and complete gyms.

Credit: Boston.com

HubSpot recently garnered recognition for its office’s inviting, contemporary aesthetic. Its chief operating officer, JD Sherman, described the company’s motif, “we have standing desks for every employee, informal lounges to make it easy to collaborate, chalk walls for brainstorming, and a kitchen in each of the main areas to foster and encourage people to meet and connect throughout the day.”

You can read more on HubSpot’s cool office chic on Boston.com.