Burlington's Building Surge
Burlington isn't about to let Boston and Cambridge take all the glory. (Everyone wants to be the romantic lead, not the plucky best friend.) Get ready for new uses in the suburban powerhouse's existing office parks and even some spec.
The Gutierrez Co recently broke ground on a 100k SF spec office building at 4 Burlington Woods, Colliers Matt Perry (photobombed by a truck) tells us. The developer expects to complete this addition to the six-building office park in a year. Likely tenants: tech, medical, sciences, or consumer product companies. Gutierrez is also seeking approval to build 350k SF, rather than 250k SF, at 400-600 Wheeler Dr, says Burlington planning director Kristin Kassner. The town’s 15M SF of commercial properties—about 10% vacant—has 5M SF in the development pipeline, with 1.6M SF under construction, she estimates.
Growing companies like Green Mountain Coffee Roasters' Keurig unit—which did a relo from Reading—often want new construction; it’s efficient, has the latest amenities, and they can consolidate and design offices that complement their culture, Colliers EVP Jim Elcock says. (Plus nothing beats that new building smell. Not even coffee.) Gutierrez is doing the 275k SF build to suit for the coffee purveyor at 63 South Ave, where it already occupies 150k SF and is seeking to start a third building sooner than expected, perhaps next year.
Oracle is building the last of three buildings (with structured parking) it owns on Van Da Graaff Drive, Colliers Tim O’Brien (above) says. The software maker has already built and occupied two other buildings here to consolidate its real estate portfolio. Next year, it will own 1M SF in town and leases even more. To capture the demand for offices, longtime landlord Nordblom recently won approval to build a 270k SF office at 25 Network Dr, Kristin says.
With rents rising back to the '07 peak's mid $30s/SF (but not yet up to $40s/SF of 2000), sales activity has been heating up. Griffith Properties and Artemis paid $61M for 1 and 3 Burlington Woods (above). The Davis Cos purchased Burlington Centre for $109M, while Charles River and National Development ponied up $216M for New England Executive Park. The thinking is that this time around, growth is sustainable; unlike the dot-com boom, it’s based on real companies with actual revenue, says Cushman & Wakefield’s Mark Roth. (Except Bitcoins. Maybe. Are those real? It's so confusing.)
To enhance value, some landlords are transforming existing office parks into mixed-use developments. For its $1B, 3.6M SF redevelopment of Northwest Park, Nordblom is planning 2M SF of offices, 300 rental apartments, and 300k SF of restaurants, retail, and entertainment called 3rd Ave. The Bancroft steak house (above) is the first restaurant to open in the $200M Phase 1. These conclaves will cluster around urban-style squares and courtyards.
The idea is to attract tech and science workers who like the Cambridge/Boston vibe and their growing companies that need large blocks of space, says Nordblom SVP Todd Fremont-Smith. Restaurants on the 285-acre property will be locally or regionally based, not national chains. The retail zone has 10 liquor licenses and will have perhaps six restaurants. The 10 office buildings being planned will lose the red brick in favor of glass, precast, and brushed-metal facades.