0 What’s Do Boston Office Tenants Prioritize?

Modern office tower Boston

Credit: Banker and Tradesman

Office tenants are using their space far different than years past. In some, but not all, cases employees no longer have an assigned desk. They simply check in and grab space that is conducive to the task they need to perform that day. This would include a phone room for a call with a client or a table for an internal team meeting.

Speaking to this trend, a recent Banker and Tradesman article aims to identify “what the [Boston office] market wants most”:

Efficiency, convenience, a great neighborhood and something “cool” that goes above and beyond for our tenants…[many contemporary office developments]…have flexible conference and events facilities with outdoor access to accommodate corporate gatherings. This maximizes the amount of productive square feet within a tenant space and minimizes the need for a large conference room, ultimately increasing the number of employees that a space can accommodate.

On-site amenities provide a company’s employees with options for a balanced and productive day within their office building. Gyms, dry cleaning and terraces are now standard in many buildings.


0 Evolving Office Real Estate Trend Shaping Boston Workspaces

Shared London office space

Credit: Bisnow

Some tenants now use a model where they lease less space and rely instead on on-demand conference room and meeting space. This model changes the square foot requirements per office worker, and has become a great resource for small to mid-sized office tenants.

From Bisnow:

These shared office spaces provide “temporary meeting space, conference rooms and event space to companies that would traditionally have leased or rented that space through their landlord. The goal is to offer employers a temporary solution on a need-by-need basis, giving office occupiers more flexibility to pursue cost-saving initiatives such as shrinking their square footage.”

One of the reasons these third-party space providers are gaining popularity within the industry is because they offer more than mere space — they provide hospitality services and create an experience that users would not otherwise get.

0 MA unemployment rate dips under 3%

Boston Statehouse

Credit: BBJ

Massachusetts unemployment hits a new record low for the century. Our economy is growing and adding jobs in all sectors.

According to a BBJ editorial, “the Bay State’s unemployment rate dropped to 2.9 percent in November, marking the first time it has dipped below 3 percent since the beginning of the century…Massachusetts added a net of 5,800 jobs last month, with the government leading the way by creating 3,800 new positions, the Executive Office of Labor and Workforce Development said Thursday. Three other sectors — construction, financial activities, and professional, scientific and business services — each added 1,000 jobs or more.”

Additional information is available on the Boston Business Journal’s website, here.

0 Boston Office Demand Poised for Best Year Since 2007

The office market continues its upward push with the best year since 2007 and no signs of letting up.  Increased rents combined with fewer tenant improvement dollars, increased construction costs and limited rent abatement make the total occupancy cost even higher.

boston office buildings

Credit: BBJ

From the Boston Business Journal:

At 13 percent vacancy, Greater Boston notched the eighth-lowest office vacancy rate in the third quarter. That rate has stayed relatively flat, dropping just 0.2 percent year-over-year, the Reis report said…The increased demand for office space is driven by continued gains in the labor market, Reis said.

“Over the last seven years, not only has the number of total jobs created per month gradually increased, but the number of higher-wage, office-using jobs has also increased,” Severino said. “The labor market clearly shifted into a higher gear in 2014 and that is beginning to have a more consistent and material impact on the office market. Vacancy compression is poised on the precipice of accelerating in the next year or so.”

0 Boston Office Market Continues to Soar

a trend of boston market peaks

Credit: Nerej.com

Rents are on the move, upward and don’t see any signs of letting up.  Class B product in the Downtown Crossing (DTX) area of the city have seen increases from the high $20’s a couple of years ago to the low $40’s.  Future predictions expect the 2016 levels to surpass the 2000 and 2007 markets peaks.

Nerej.com notes, “the city of Boston office market is absolutely exploding. 1.72 million s/f of office space was absorbed in 2014, 35% more than in 2013, and 50% more than in 2012. What statistics do not show is that Boston as a city has $110 billion in total assessed value for all its properties; $4 billion in new construction breaking ground, 4,500 current job openings and 44 tech IPO’s in the pipeline. 50% of total absorption in 2014 was urban migration from the suburbs. As of the start of 2015, there are 222,000 s/f of tenants in the market for downtown space alone.

You can read more about the Boston Office Market explosion on Nerej.com.

0 Boston Development Remains Strong into 2015

office development in BostonIn 2014 Boston benefited from some significant growth and 2015 looks to be more of the same.

The Boston Business Journal posted some numbers to illustrate Boston’s 2014 development:

  • $4 billion worth of new construction will have broken ground by Dec. 31, up 16.4 percent from the year before.
  • 7.5 million square feet of total space will have been added.
  • 12,000 construction jobs were supported this year.
  • 3,859 housing units are under construction, on track to meet a target of 53,000 units by 2030.

One of the many contributing areas to the boom is the Boston Innovation District.

0 What Makes for Cool Office Space in Boston?

Modern office space in Boston

Credit: The Boston Globe

Some of the creative spaces to work house some interesting amenities that would have been frowned-upon in the recent past.  How we work and how we collaborate has evolved, and companies are trying to offer a creative and fun environment that can help their teams excel.

Cool features include:

·         Hammock
·         Beer tabs
·         Standing desks
·         IT vending machine
·         Nap room
·         Kitchens with large flat-screen TV’s
·         Foosball
·         Treadmill desks
·         No assigned desks
·         Wall displays of employees which is designed to make introductions
·         Town hall styled meeting space
·         Glass, glass and more glass for abundant natural light

A recent Boston Globe article on Boston’s “Cool Office Spaces at Top Places to Work“, notes “some of Top Places to Work winners have some excellent digs for their employees. Newer workspaces include beer on tap, flexible workstations, and even a nap room in one case.” The Globe article also includes a slideshow of Boston’s stylish office spaces to peruse.

0 How Do You Feel about Office Beacons?

Office beacons in Boston real estate

Credit: OfficeBeacon.com

Does your office use beacons like Digitas to figure out your movement with the office?

From Digiday:

“DigitasLBi…has installed 120 beacons — devices that communicate with nearby smartphones via Bluetooth technology — in its Boston office in order to identify how and where its employees congregate. The goal is to learn how to improve office design and meeting scheduling.

‘the most immediate goal…was to use data collected from the beacons to establish a baseline for how the office’s 700 employees currently meet with one another.'”

Does this sound like a model for efficiency or will it yield a new mode of employee resentment?

0 Boston Office Market is Positioned for Continued Growth

The Boston office and retail market is expected to continue its upward march.

Boston office market trends

Credit: multihousingnews.com

According to an editorial on MultiHousingNews.com, “developers completed approximately 4.2 million square feet of office space over the last 12 months as compared to merely 1.4 million square feet in the previous year. Around 5.2 million square feet currently under construction in the metro area is expected to come online throughout 2016. According to Marcus & Millichap, approximately 3.2 million square feet of office space is set for completion by the end of 2014—a 1 percent increase from 2013—with new inventory being heavily concentrated in the Boston/Suffolk County and Route 128 North submarkets.”

For a detailed indicator of the Boston office market direction, jump over to the MultiHousingNews website.