Credit: Boston Business Journal
The rents in the Seaport/Innovation District continue to climb. Recently the Class B renewals have pushed to $45 PSF, with that in mind we have a record trade of $60.2 million or $400 PSF.
From the BBJ:
TIAA-CREF has acquired 51 Sleeper St. in Boston’s Seaport for $60.2 million, setting a record sale price for the city’s burgeoning Innovation District of roughly $400 per square foot.
The full article is available on the Boston Business Journal.
Office rents have increased in excess of 40 percent in the last two years in the Innovation District. What will happen as those leases start to roll in 2014, will those tenants be able to afford the new rents?
Credit: InnovationDistrict.org
A recent editorial in the Boston Globe noted the challenges facing small businesses and occupants of the Innovation District:
“The Innovation District is in danger of becoming a top-heavy boutique neighborhood because it targets price-sensitive businesses, but has no way of providing stable rents. There’s no consensus about who should pay to keep office rents affordable at the very low end — developers, large companies, area institutions, or the city itself could all conceivably handle the job — and, even if consensus did exist, there’s no means of enforcing it.”
Jump over to the BostonGlobe.com for the full article.
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Why are tech tenants looking at the Financial District? Value, access and availability. Currently the Financial District is the only submarket that has it all. Rents within the Class B segment can still be achieved in the mid to upper $30’s PSF while comparable spaces in Back Bay would trade in the mid to upper $40’s PSF.
A Banker & Tradesman article explains the attraction of the Financial District, quoting Ben Heller, a managing director at Jones Lang LaSalle:
“Tenants increasingly view the Innovation District, Fort Point Channel and Financial District interchangeably when scouting office locations…the infill of residential and destination retail is really making an impact on office space there.”
Follow the link to view Boston Financial District office space for lease
Photo Credit: Boston Business Journal
As rents have continued to rise and vacancy has dropped, landlords are becoming more bullish on the office market future. Spec buildings, previously considered a thing of the past due to the high cost of construction (compared to the cost of renovating an existing structure) are reemerging in the Hub’s commercial landscape with a new addition to Boston’s marine industrial park.
The Boston Business Journal reported, “Danvers-based Kavanagh Advisory Group is expected to break ground by year’s end on the first new building in six years on the eastern edge of the Hub’s Innovation District.”
Details on the spec building are available on the BBJ’s coverage of the new development at Marine Industrial Park.
Photo Credit: Grub Street Boston
The Seaport/Innovation District is not only a live/work area of the city, but now a destination location for a great dining experience. Restaurateur Seth Greenberg’s new bistro will add a touch of French flavor to Boston’s Fort point neighborhood.
Grubstreet.com quotes Greenberg’s vision, “Bastille Kitchen will be the destination dining anchor to Boston’s Fort Point neighborhood that Pastis is to New York’s Meatpacking District.”
The migration of tenants into the city continues with Communispace moving from Allston to the waterfront area of the Financial District.
According to the Boston Business Journal, “the new location for the Startup School, at 290 Congress St., is ideally situated near a large number of fast-growing tech firms.”
More information on the Boston Startup School, including its mission, programs, and new address, is available at the Boston Business Journal.
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