Burlington Is Stealing The Urban Core's Thunder. Here's How.
To steal some tenants from the hot urban core (and keep those they have), National Development—and other landlords—are delivering an urban office environment to this suburban market.
Construction just started at the former New England Executive Park, now The District Burlington, which National, AEW Capital Management and Charles River Realty Investors acquired for $216M. Other major developers in the market are Nordblom, The Davis Co and The Gutierrez Co. Burlington has a deep tenant base, is an established corporate headquarters location and can draw a high skilled workforce from north and west of Boston, National’s Andrew Gallinaro, who’s overseeing the redevelopment for National and its partners, tells us.
Since the bad old days of 2008, Burlington has rebounded from what was an 18.6% office vacancy rate. As of Q1, this suburb on Rte 128 has a 10.3% vacancy rate, despite the growth of the supply, says JLL analyst Wes Simon. Average asking rents, which had fallen to $23.96 by mid-2010, are up nearly 50% to $31.68. Now, the town is the fastest growing part of the northwest suburban market. “It’s the happening place, especially for tech companies,” Wes says. Software maker Oracle and Green Mountain Coffee Roasters Keurig have also been expanding here. Gutierrez has so much faith in this market, it’s just delivered a 100k SF office at 4 Burlington Woods on spec.
With the advantage of flexible zoning from the town, National is rebuilding the old office park. In addition to the new and renovated buildings, it's refashioning the streets, adding walking paths and widening sidewalks. The space added to the tower will have larger floors and be appropriate for an open plan layout, Andrew says.