September Update from Lee Partners

54 Middlesex Turnpike: building improvements complete and new lease signed!

 

Lee Partners secured a long-term lease at the newly renovated building for Orthopaedics Plus / Spectrum Fitness. They are moving from a Burlington location to this prime spot in Bedford on Middlesex Turnpike. This is just minutes from the Rt. 3 – Rt. 62 interchange, the first exit north of Rt. 128. Orthopaedics Plus signed for 5680 s.f. of newly fit-out space in the north wing of the building, surrounded by trees and greenery.  It will provide a great experience for their customers.

Seen in this photo are the building owners, Kevin and Ian Curran and Orthopaedics Plus principal Justin Pezick. John Wilson of CBRE represented the tenant in the transaction.

 

 

DACON Corporation – a design-build specialist which has constructed millions of square feet of prime office space in the Greater Boston region was the contractor. They recently finished the multi-million dollar renovations of the property, including providing two new elevator shafts and two new entry atrium areas.

 

The building is currently available for lease for office, retail and restaurant uses.

 

Lee Partners is ready to help your company find a great location for your operations. We facilitate the negotiation process so you can relocate fast and keep your focus on your business.

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REFA Fall Conference – September 15, 2017

We attended the Real Estate Finance Association (REFA) Fall Conference in Boston last week and it was three hours of presentations and discussions by experts reviewing the current state of the commercial real estate markets in the Boston area – to include investment fundamentals, Tenant drivers, and project financing in today’s environment. Other topics touched upon included the impact of driverless vehicles, reduced parking demand, and artificial intelligence being used to drive data decisions for real estate and other aspects in our economy.

 

 

Investment Fundamentals – Low Interest rates are expected to be ongoing.  “In Boston the investment fundamentals are the best ever and the cycle has a way to go” – “although you need to be careful in the suburbs”.  Within a Foreign Investment Index Boston has recently moved up from the 27th to 7th place for top investment cities in the world – a huge jump in the rankings.  Sixty (60) percent of the trades in Boston are now being purchased by foreign investors – from Europe and Asia.  Trophy core assets have very strong interest although; the market is thin due to the lack of inventory.  One recent sales effort totaled over 100 property tours that resulted in 27 offers and led to 7 rounds of negotiations before a final buyer was selected.   Advices offered to owners of properties included reviewing the asset every quarter, focus on trends, and become more analytical in determining its current value. 

 

Tenant Drivers –

 

Boston:

 

In today’s market there appears to be two types of tenant decisions being made.  One is by the “gut” by the highest paid person and the second is led by “geek” deliberations that are “data driven”.  Driving decisions today is an ongoing “War for Talent” with “alpha geeks” in top demand.  This search for talent is real and a key factor in company relocations – especially in Boston.   Examples discussed included “Log Me In” and their move from Woburn to 100 Summer Street in Boston where their rent doubled – but resulted in a new workspace environment with all open space and no fixed walls as they could more easily recruit new talent and grow to a 4.0 billion dollar company.  AutoDesk moved from Waltham to the innovation district in Boston where they wanted a more innovative high energy environment and to be closer to employee talent and competitors.   PTC moved to the Seaport from Needham primarily to attract new talent.  Goodwin moved to the Seaport District (375,000 sf) upon their lease expiration to foster a new culture and workspace plus to provide a better “user experience” by creating a huge first impressionable lobby area with a concierge desk  where clients are given a personal escort to the top floor conference rooms.  In addition the move provided for more collaborative space, flexible configurations and increased tech efficiency.

 

In all of these relocations the decision makers were more interested in the location than the economics included in the transaction.  One statistic quoted was that when tenants pay $40 to $80 per square foot or more for their lease space, this is a very small part of the overall employee cost of $1,800 per square foot   As a side note, it was mentioned that young people are living in rental space twice as long now as they did in 1974 – for a variety of reasons – but the implication was that younger potential new employees are living and being more accessible for employment by renting for longer in the city.  Catering to talent is key to successful recruitment efforts.  Google on the West Coast is now building residential housing for employees and Twitter offers free food for employees plus one day a month employees are encouraged to bring a friend or family member for a free meal – also to show off their new facility – and as a recruitment tool!

 

Suburbs:

 

The Kronos move to the Crosspoint towers – a consolidation from 3 buildings to one – was driven by having increased employee collaboration as an incentive plus a raft of amenities to include quality food service, on-site restaurant, a first class work out facility, simulated golf and shuffleboard areas – getting employees to do things together.  Also, by providing this type of work environment, one goal would be to keep employees working longer to achieve more productivity beyond the normal 8 hour work-day. Similar sentiments were voiced at the Middlesex Coalition presentation last month in Burlington when the Millipore move to a single building site Burlington from their Bedford and Billerica operations was discussed in depth.  Employee collaboration, one full floor in the building devoted to high quality amenities, and having expansion pre-negotiated were key factors.

 

Financing Discussion:

 

One panel member offered “we are in the mid-point of the cycle and as a multi-billion dollar lender we are in “good shape overall” with very few problem loans.  2015 was a record year and increased activity is expected for all of 2017.  Capital is available; inflation is stable, strong demand for industrial properties – with office and retail requiring more scrutiny.  Another panel member stated that we are in the “later innings” of the cycle – but there are no reasons to panic.  He has placed $800 million so far this year in Boston with more expected by the end of the year.  Another panel member indicated we are “experiencing strong economic fundamentals” and they expected to place $ 80 billion in 2017.  Acquisition volume is down somewhat – but refinance volume is up.  The question came up as to how the panel members would finance “creative space” and would they loan on the tenant credit?  The answer was that the lender would not look to the tenant for backing of a loan – it would require the credit of the property owner and also require a view of the owner’s business plan.  Anything above a 70% loan to value would be a challenge for an acquisition placement.  For a over $ 100M loan one panel member indicated that their terms would range from mid to high 100’s over the current LIBOR rate, another indicated that a blended rate of mid to high 2’s could work; while the third panel member indicated that rates would be in the high 2’s or now 3’s for floating rates.  Loans in the 50 to 65 LTV areas would be more normal.  In my opinion these historically low LTV’s are one reason why the lenders are not worried about a future down-term in the market.  They are not over-leveraged as they were in the past cycle with landlords having substantial equity in their projects.

 

[After the meeting, we walked around Boston a little bit. It was a good day to check out a lot of the construction and development work going on.]f

Here’s a view of Fan Pier with the seaport area:

Here are some of the towers along the Rose Kennedy Greenway:

Here we are on Boston Common:

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Re-cap of Recent Activity at Lee Partners

2017 has been good for Lee Partners! We have worked with a number of great clients to help them find just the right space for their operations.

BeiGene – here is a view of the new offices for BeiGene USA – their HQ in Cambridge, MA.  Lee Partners Represented BeiGene in a five (5) year direct lease with Landlord for 14,931 sq ft of office space.

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Here’s the interior lobby of 55 Cambridge Parkway, Cambridge, MA – a really classy location in the heart of Kendall Square – the global center of innovation for biotech.

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BeiGene has a beautiful view from their new HQ space at 55 Cambridge Parkway, overlooking the Charles River

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Out in the suburbs, on the Route 3 Technology Corridor, Lee Partners represented both the buyer and seller in $5,200,000 47,000 sq ft. property sale at 54 Middlesex Turnpike, Bedford, MA.

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Nearby, at 155 Middlesex Turnpike, in Burlington, MA, Lee Partners represented the seller in this $2,200,000 office property sale.

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Lee Partners also represented Broadcast Pix in the relocation of their HQ location from 3 Federal Street in Billerica to 27 Industrial Avenue, Chelmsford, MA

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We also represented IDEX America in the relocation of their USA HQ office facility from Tewksbury, MA to 187 Ballardvale Street, Wilmington, MA.

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Spinning Wheels Express– Lee Partners represented Spinning Wheels Express in their HQ lease renewal at 1600 Osgood Street, North Andover, MA.

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Another client was StopLift Vision Systems –Lee Partners represented StopLift in the relocation of their USA headquarters location to 186 Alewife Brook Parkway, Cambridge, MA.

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On the retail side of things, we were able to help Sullivan Tire with this 5 year lease renewal for the very successful Bedford, MA Sullivan Tire Store.

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And don’t forget our exciting assignment in Tampa, FL: here we have a big opportunity: Exclusively Listed for sale at $6,000,000 – a rare new hotel site in downtown Tampa FL!

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IDEX America relocation to Wilmington

Bruce Lee represented IDEX America, Inc in the recently negotiated move from their office space at Three Highwood Office Park in Tewksbury, MA to approximately 15,000 sq ft of office space at 187 Ballardvale Street, Wilmington, MA.

The IDEX America relocated office will provide R & D and engineering support to IDEX ASA, Norway. The process was lead by Bruce helping to negotiate the transaction with Henrik Knudtzon the CFO of IDEX America, located in Norway. Despite the distance
clear communication was maintained throughout the process and a very competitive lease deal was reached. Kristen Ryan, office manager for this Massachusetts facility was extremely helpful in coordinating the move details along with engineering VP Guido Bertocci.

Occupancy is scheduled for September 1, 2017. Christopher Lawrence of JLL represented the owner Griffith Properties and he provided professional services throughout the negotiations.

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BeiGene Research & Office relocation to Cambridge

During the end of 2016 Bruce Lee of Lee Partners on behalf of BeiGene negotiated a sublease with Alexion Pharmaceutical Company allowing BeiGene to relocate from Waltham to the Kendall Square area of Cambridge, MA.

This was a follow up transaction to when Bruce helped to negotiate a BeiGene small start-up office suite at Reservoir Place in Waltham for Howard Lang CFO – opening with only two employees in 2015.

BeiGene, a Chinese pharmaceutical company, commenced start up operations in
Waltham based upon a license occupancy agreement with Boston Properties – leasing 1,400 sq ft on a short term commitment at Reservoir Place. Bruce also helped to negotiate a 600 sq ft. expansion – also on a limited license basis at the same building.

As it became apparent that BeiGene would expand its local presence, Bruce led the efforts to identify and secure a much larger facility – resulting in the sublease from Alexion Pharmaceuticals at 55 Cambridge Parkway, Cambridge. The sublease also included in-place furniture and a right to expand within the sublease term. A sublease expansion option was exercised and BeiGene did expand into the entire sublease space consisting of almost 15,000 sq ft in August 2017.

In parallel with the sublease expansion, Bruce led the efforts for Lee Partners and was
successful in negotiating a direct 5 year office lease deal with the building owner 55 Cambridge Parkway LLC. that will secure this location for BeiGene for the long term.

During the start-up process in Massachusetts Howard Lang BeiGene CFO was key executive decision maker. He was helped in the relocation process by consultant Eva Macarthur. Dan Maller also with BeiGene led the BeiGene efforts to secure the long term lease. Representing Alexion Pharmaceutical in the sublease was Connor Barnes, VP with Cushman & Wakefield of Massachusetts. Representing the building owner throughout the sublease and direct lease were Jeffrey Moore and Christopher Scott both Vice Presidents with the Lincoln Property Company.

Here is the view from their new space:

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Sale of 52-54 Middlesex Turnpike, Bedford, MA

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The two-building complex located at 52-54 Middlesex Turnpike was purchased by Kevin Curran of Curran 54 LLC from Jeff Goldberg and David Smerling, owners of Bedford Executive Office Suites, LLC during March of 2017.

The 47,000 sq ft and 8,000 sq ft building complex, sited on 6.5 acres, is located in the newly extended section of the Middlesex Turnpike in Bedford that reaches from Burlington to Crosby Drive in Bedford – where many of the leading technology companies in the area are located.

The 8,000 sq ft building is occupied by The Goddard School on a long term basis.

A total renovation of the 47,000 sq ft. Class C office building will start on September 6, 2017 when the building will be transformed into a Class A, mixed-use, office and retail campus.

SD-2 first floor renderingNew Building RenderingThe General Contractor for the renovation project is Dacon Construction headed by President Dennis Quinn. Chuck Riley VP for marketing at Dacon and Jeff Price
Lead estimator were critical in developing the renovation plans and pricing. Dennis McCarthy, lead architect for PDA architects, an in-house division of Dacon, is the lead architect for the project.
Bruce Lee was part of the team that originally sold 54 Middlesex Turnpike to Jeff and David almost 20 years ago. In addition, Bruce represented The Goddard School and the owners of 54 Middlesex Turnpike in securing a long term build-to- suit lease with The Goddard School. Bruce represented both the buyer Kevin Curran and the seller Bedford Executive Office Suites, LLC in the most recent-purchase/sale transaction.

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Sale of 155 Middlesex Turnpike, Burlington

Lee Partners represented Tom Fulchino of G.F. Properties, LLC in the successful sale of his 13,000 sq ft class B office building located at 155 Middlesex Turnpike, Burlington, MA in January 2017.

The sale was completed to the technology company Ovitas, Inc. The company had been leasing space at 60 Mall Road in Burlington, MA when they decided to make an offer to purchase 155 Middlesex Turnpike. Fortunately for Ovitas they were successful in purchasing the building.

Bruce Lee of Lee Partners was the exclusive sales agent for the property and within 45 days was able to obtain 12 written offers to purchase the building for the owner. The marketing program was so successful that a sales sign did not need to be posted on the property advertising its availability.

Officially G.F. Properties, LLC was the seller and Ovitas, Inc the buyer. Joel Aho of O’Brian Commercial Properties, Inc represented Ovitas, Inc. Tibor Tscheke, Managing Director of Ovitas, Inc. was the key contact at Ovitas throughout the sale/purchase process.

Bruce Lee tapped into his extensive connections in the industry and marketed directly to many potential buyers during the marketing program and kept the lines of communication wide open with all throughout the sale process.

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Falling Forward! Recapping a Busy Summer For Lee Partners

This summer was an active time for Lee Partners – we represented many corporations and entrepreneurs and helped them locate, negotiate for, and occupy new space. A few of our highlights are below:

We helped Anthony Oliveri to lease space at 101 Clematis Avenue in Waltham for start up engineering company that had been his family dream for many years – it could become a modern-day “Hewlett Packard” engineering success story right here in Massachusetts!

Following this effort we helped another company – BeiGene – locate and negotiate office space at a Class A office building known as Reservoir Place at 1605 Trapelo Road in Waltham.

BieGene commenced operations in September in their new space. This company, with most of its employees located in China, is well known in the biotech field. Significantly, they just secured $97M in venture funding. The new Waltham executive office expands their presence in the United States.

Additionally, we helped another start-up company lease office space in Bedford –Exascale Networks – where the founders will open operations at 209 Burlington Road.

Continuing a long term support effort – Lee partners represented Polatis – a technology company with offices in the UK and Europe in the extension of their office space lease at 213 Burlington Road in Bedford. What a great location!

Bruce helped Boston Install to locate, negotiate, and secure expansion lease space at 18 Terry Avenue in Burlington.  This will supplement and expand their Lawrence operations. Watch out for that truck!

Bruce also spent a lot of time this summer representing McGlynn, Clinton, & Hall Insurance in the purchase of their new office building space at 325 Boston Post Road in Sudbury – expanding their business and lowering their overall cost of occupancy. Larry McGlynn’s insurance business was ending a 10 year lease and Bruce helped to locate, negotiate, and secure the new space.

Lee Partners also had the opportunity to work with a highly innovative company called IDEX – US. IDEX, with headquarters in Europe, is expanding to the US and secured office/engineering space at Highwood Office Park in Tewksbury. Bruce represented IDEX in the initial lease of space at Highwood Office Park and recently helped them to expand into a total of 10,000 sq ft. of space. They are developing exciting next generation mobile personal identification technology. A company to watch!

As you can see – it has been a busy summer for Bruce and Lee Partners – representing companies that are starting up, growing, and expanding in the suburban Boston commercial markets!

Are you looking to move? How can I help you?

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Walkable Waltham Too!

Waltham Center has been going through a transformation due to the creation of MERC at Moody and Main St. The old Athena Health office building below will be torn down to create luxury housing, right across from the Waltham Common.

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The MERC is a new development by Northland. This is an amazing project of 269 apartments aiming at Millennials so they can live in an urban style, but outside of Boston in a smaller community, close to the highways and suburban office market.

From their project website you would read: “The Merc at Moody & Main is Northland’s newest, transit-oriented apartment community. Located in the heart of downtown Waltham, it’s a short walk to shops, restaurants, museums, the Town Common, and an extensive array of transit options to downtown Boston, Route 128 and beyond.

“The architecture and design evoke and respect the historic character of downtown Waltham while providing exciting, modern, energy-efficient, sustainable living. The ground floor shops and restaurants further enhance the neighborhood and living experience of residents.”

The new development follows on the successful redevelopment of the old Grover Cronin department store in the 1990’s which re-vitalized Moody St and began to help Waltham take advantage of the amazing Charles River as an amenity for residents.

You can launch a canoe or kayak from the landing right next to Moody St.

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Looking from the north side of the Charles south to Cronin’s Landing. Moody St. bridge on left.

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The dam at Moody St. as seen from the bridge. The old mill building and Museum of Industry is to the left – you can just see the chimney. Boston is straight down the river – passing Watertown and Cambridge on the north and Newton and Allston on the south.

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Waltham has a historic common where the City Hall and other important buildings used to reign. Now the MERC w/ hundreds of new residents will have this feature as their front yard.

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There is a lot of history in Waltham – from the Revolutionary War, the Civil War, the industrial revolution all the way up to today’s developments as part of the Greater Boston region.

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Downtown Waltham is on the MBTA Commuter Rail – the Fitchburg line. The station stop is on the south side of the Common, right at Moody St! It is 12 minutes to Porter Square in Cambridge to catch the Red Line to Kendall Sq (another 9 mins) and 20 mins to North Station in Boston. Trains are fairly regular every hour, more in the morning rush hour.

 

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It is exciting to see this new development going up in Waltham and it will help the City continue to attract bright young people who want to work in the high-tech industry. These folks will become customers of the many small businesses in the area and help improve the innovation economy!

IMG_2144 IMG_2139But brace yourself, the MERC ain’t cheap:

  • Studio starts at $2,100 per month;
  • 1 Bedroom starts at $2,145
  • 2 Bedroom starts at $2,845
  • 3 Bedroom starts at $3,645

These are RENTS! If you were looking for a condo or a nice house near Waltham Center, you should be looking to buy right now!

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Waltham Strong

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Photo of Polaroid Site from Bear Hill Road


A drive thru the City of Waltham today revealed a vibrancy and economic resurgence that is exciting to watch take place! Construction activity abounds with new office buildings and apartment buildings being completed in a wave of 2014-2015 new construction. Most obvious is the redevelopment of the Polaroid Site just off of Rt. 117. This site has almost one mile of direct frontage onto Rt. 128. It is becoming a new home to a massive mixed use retail/office development that is transforming the landscape along Rt. 128 – America’s Technology Highway. The site has over 100 acres and it is approved for 1.2 million sq. ft. of new office/retail/residential development.

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Photo of Clarks America HQ

Boston Properties has under construction a 120,000 sq. ft. 4-story building at 1265 Main Street and it is already pre-leased by Clarks America. Clarks is relocating from Newton Upper Falls and will have 400 employees working in this building by early 2016. The building will have a roof deck, private outdoor terrace of 5,000 sq. ft., an employee store and a new fitness center. Over 400,000 cars will drive by the front of this building every day.

10 City Point Under Construction

10 City Point Under Construction

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Less than a mile from the Polaroid site, Boston Properties is completing a new mixed use 230,000 sq ft. project at 10 City Point (Totten Pond Road & Winter Street). Wolverine Worldwide (parent of Stride Rite and others) has signed up for 150,000 sq ft. to kick off the 230,000 sq ft. project that will include retail plus the office component. The retail tenants will start off with a new Posto restaurant (from Davis Square) and Bone Fresh Grill.

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The New 275 Wyman Street

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At Hobbs Brook Park on Wyman Street the finishing touches are being put on the 275 Wyman Street redevelopment project. This redevelopment is the result of taking a 80,000 sq ft. older office building site to a brand new LEED Certified 315,000 office building plus a 1,025 space parking garage. VistaPrint will be moving into 150,000 sq ft. of office space by the end of this year. Nice Work, Hobbs Brook!

 

Stay tuned for more news from the exciting City of Waltham!

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