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Route 495 Office Market Improves but Remains Bifurcated

BOSTON – According to a market report released by Cresa, the Route 495 market remained relatively stable during 2013, with many companies opting to remain in the area or relocate in hopes of attracting and retaining top talent.  The area, however, is highly bifurcated.  Framingham and Natick in Metrowest (which also includes Wayland, Southborough, Marlborough, Northborough, Westborough, and Hopkinton) continued to outpace the rest of the suburban market with a vacancy rate of only 7.2%) and rents ranging from $19-$25 per square foot for Class A space.  In contrast, cities and towns in 495 Central (including Boxborough, Concord, Acton, Littleton, Carlisle, Stow, Maynard, Sudbury, and Bolton) have a vacancy rate approaching 25%, with asking price for rents about $15 per SF.

David Ross, a Cresa principal, analyzed the office and flex/industrial markets on Route 495, looking at the last quarter of 2013 and forecasting trends in 2014.  The Route 495 report is part of Cresa’s launch of comprehensive Tenant Reports that will focus on Boston submarkets twice a year.   

Report highlights include:

· Framingham and Natick are the tightest markets in the area—and all of the suburbs—with single-digit vacancy rates.

· In the last two years, many large companies have moved out of the suburbs and into Boston's core urban districts. However, towns in the Metrowest marketplace, especially Marlborough, are doing a very good job retaining larger companies, and landlords are  redeveloping buildings and campuses

· Boston Scientific and Mathworks are among some of the larger companies expanding their Marlborough operations.  Atlantic Management purchased old HP campus and is redeveloping.

· While availability remained relatively stable throughout the area during 2013, asking rent increased slightly for office and flex products.

· As the growth continues in the outer boroughs and Metrowest, developers and investors are taking notice and starting to replicate the “work, live, play, stay” campus that the urban centers have been pushing for the last few years.

· In 2014, Cresa predicts that industrial landlords will consider “spec” building of new warehouses along I-495, and office investors will continue to “circle” the Framingham/Natick marketplace to take advantage of the low vacancy rates and redevelopment opportunities.

According to Cresa, what differentiates the Tenant Reports with most other market outlooks is that Cresa focuses on the tenant’s point of view, and the firm’s commentary often runs counter to that of traditional firms that represent the tenant and the landlord.

To view the full 495 reports, click here.  To contact Dave Ross, call 617-758-6088 or email dross@cresa.com.

Cresa LLC, North America’s largest corporate real estate advisory firm exclusively representing tenants, is headquartered in Boston. 

Cresa is an international corporate real estate advisory firm that exclusively represents tenants and specializes in the delivery of fully integrated real estate services, including: Transaction Management, Project Management, Strategic Planning, Workforce and Location Planning, Subleases and Dispositions, Portfolio / Lease Administration, Capital Markets, Sustainability, Industrial / Supply Chain, and Facilities Management. With almost 60 offices, Cresa is the largest tenant representation firm in North America.

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