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Suburban West - 128/Mass Pike
Market Highlights
The Suburban – Route 128/Mass Pike area contains 10 towns including Allston, Brighton, Brookline, Needham, Newton, Waltham, Watertown, Wayland, Wellesley and Weston.
Contact – Alex Dauria, Senior Vice President, Brokerage Group
Route 128/Mass Pike – 1st Quarter 2004
Overview – Availability in the 18.7 million square foot Route 128/Mass Pike office market was 28.7%, having slowly drifted down by 1.3 percentage points from the record high 29.1% availability recorded six months ago. No further construction is underway and therefore, despite modest demand we expect availability to continue to slowly decline.
Activity and Absorption – Most lease transactions were less than 35,000 square feet in size. Two of the largest moves in the quarter were Quinn Printing’s 35,882 square foot sublease at 165 Needham Street in Newton and Fast Search & Transfer’s 25,107 square foot relocation to 117 Kendrick Street in Needham. Several large blocks of space also hit the market early in the quarter including Accenture’s 62,952 square feet at 100 William Street in Wellesley Office Park and two in Waltham – Phase Forward’s 63,479 square feet at 1440 Main Street, left behind after they relocated to 100,000 square feet at 880 Winter Street in Waltham Woods. Lycos is also willing to give up as much 93,523 square feet at 100 Fifth Avenue. Nevertheless, positive absorption of 26,367 square feet was still netted, after posting 213,000 square feet on the plus side of the ledger at the end of 2003, making it two quarters in a row.
Rental Rates – Average asking rent at $21.63 per square foot gross has declined 12 quarters in a row from the peak average $43.80 quoted in the first quarter of 2001. Class A asking rents in trophy locations in Waltham range from $27 to $30 per square foot gross in Waltham Woods and from $24.50 to $28 at Bay Colony Corporate Center. Wellesley Office Park rents range from $26 to $29 per square foot.
Outlook – Requirements for space are modest with twenty-seven totaling 788,400 square feet targeting the Route 128/Mass Pike office market. Many landlords dropped rents in January-February but with 5.2 million square feet available and no evidence of sudden surge in demand we see little justification for higher rents at this time.
Recent Waltham Transactions
- Compound Therapeutics, Inc., subleased 17,500 square feet from Genome Therapeutics on the third floor at 100 Beaver Street.
- Interleukin Genetics, Inc. expanded to 19,000 square feet by leasing an additional 13,000 square feet at 135 Beaver Street.
- Countrywide Home Loans, Inc. leased 9,000 square feet on the third floor at 300 Fifth Avenue, having now grown to a total of 51,700 square feet in eastern Massachusetts with location in Danvers, Dedham, Worcester, as well as Waltham.
- Enclave Properties, LLC purchased 115-125 Second Avenue from CTC Communications, Inc. on March 22nd. The 1-story 71,250 square foot building was constructed in 1960 by CC&F and renovated in 2001. The 2.9-acre site is located just south of Winter Street. The price was $7,150,000 or $100 per square foot. Enclave reportedly plans to subdivide the building into private data suites ranging from 200 to 10,000 square feet in size. Cornerstone sold the building to BayBank in 1989 who occupied the building in the early 1990s. After the BankBoston merger, the property was sold to CTC Communications.
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