Waltham's New Face
Driving through Waltham on Route 128, it's impossible to miss the quickly changing landscape. Strong tenant demand and rapidly rising rents are driving a wave of development that’s bringing what today’s workforce wants: new offices with a full plate of amenities, says Avison Young principal Keith Gurtler. Behind him, overlooking the highway, is the new 136k SF build-to-suit office for longtime Waltham company Thermo Fisher on a site it purchased from the city’s largest landowner, Boston Properties, which owns 3.1M SF here.
Nearby at 99 3rd Ave is The Stack, where Boston Properties has developed venues for two eagerly awaited restaurants: Posto, which is expanding from Davis Square in Somerville (and is just hiring its staff), and Bonefish Grill, a recently opened new location for the national chain. As office occupants recruit talent, workers—especially Millennials—want to know that they can walk to oases like this for a break during or after the workday. For the landlord, a more dense and lively retail presence enhances their competitive position with the rival suburb a few miles north on Route 128, Burlington.
Two weeks ago, Waltham property owner Hobbs Brook Management celebrated the grand opening of Cimpress’ newest office in the US for its Vistaprint unit at 275 Wyman St. Long-term owner Hobbs Brook demolished older buildings to create the office that can be LEED certified. It has enough amenities to entice the graphic design and printing firm’s relo from Lexington: meeting spaces on each floor for collaboration, game rooms, mothering rooms, an elaborately outfitted fitness center, a library for silent work and a below grade link to a 1,025-car parking garage. As a build-to-suit, the new complex aligns with Vistaprint’s business model and corporate culture.
At Boston Properties’ City Point, the REIT is building a new 230k SF office with Route 128 frontage. The anchor tenant—in 150k SF—is Wolverine Worldwide, which makes shoe brands Stride Rite and Keds. Why is Boston Properties developing so much here? It’s achieving rents of over $50/SF gross in this building from various tenants, while Wolverine made a 15-year commitment in the mid-$40s/SF, Keith tells us. The rents reflect the “dramatic rise” in Class-A office rates of $3/SF to $5/SF in the past six months alone. At the close of Q3, the vacancy rate for Class-A Waltham offices stands at 4.4%, compared to 9.7% a year earlier, Avison Young research analyst Tucker White tells us.
Behind the Wolverine building, Boston Properties, has more land to accommodate the growth underway, says Avison Young VP Mark Coelho. Already bigger are Vistaprint, which expanded from 200k SF to 302k SF; Care.com, from 50k SF to 120k SF; Actificio doubled from 25k SF; and Bit9 tripled to 60k SF. Meanwhile, 867k SF of new and renovated space is under construction or recently completed.
Boston Properties partnered with the Demoula family that owns Market Basket supermarkets to redevelop the 119-acre site that once housed Polaroid. For nearly 10 years, efforts to develop the site fell short. The site is rocky, traversed by electric lines and various projects ran into the recession. But the current team—the third since the camera maker left in 2005—is advancing its plan for 280k SF of retail, including the 90k SF supermarket that opened earlier this year.
On the other side of the site, peering over the highway, the partners are building a 120k SF HQ for Clarks, opening in 2016. Still, Boston Properties and the DeMoulas can develop another 1M SF there, Mark says. By then, it’s hoped that the project will have a ramp that gives it direct access to Route 128 via Main Street.
