Suburban Boston Office/R&D Property Commands $93.5M
- Aug 01, 2012
The office and R&D complex at 174 & 176 Middlesex Turnpike in Bedford, Mass. has come under new ownership, courtesy of a $93.5 million transaction. With commercial real estate services firm Cushman & Wakefield of Massachusetts guiding the way, Real Estate Capital Partners USA Capital Trust sold the 328,200-square-foot trophy asset to Cole Real Estate Investments.
The two Middlesex buildings last changed hands in 2005 when RCU acquired them for $95 million.
Sited on nearly 55 acres approximately 20 miles north of Boston, the four-story building at 174 Middlesex and the three-story structure at 176 Middlesex offer a respective 188,200 and 140,000 square feet of space. The complex was developed in 2001 by The Guttierez Co. as build-to-suit facilities to serve as the headquarters for RSA Security, which continues to occupy the property in its entirety. The space allows RSA to conduct its administrative business, research/development activities and laboratory and manufacturing operations in one location.
Cole need not worry about RSA abandoning the buildings in the near future, as the company renewed its lease in February of this year, extending what had been an expiration date of 2016 to 2024. Facing a large vacancy could be a challenge in the current suburban Boston market, where the overall vacancy rate was 21.4 percent. In the Route 128 North Corridor, home to the Middlesex property, the vacancy rate was 13.9 percent.
Facing a large vacancy could be a challenge in the current suburban Boston market, where the overall vacancy rate was 21.4 percent in the second quarter, according to a report by Cushman & Wakefield. However, in the Route 128 North Corridor, home to the Middlesex property, the vacancy rate was 13.9 percent. Of course, there is a reason for the drastic difference in the numbers. “Growing technology occupiers with large space requirements chose the northern suburban submarkets over the more crowded urban markets during second quarter,” as noted in the report. Leasing activity totaled 2 million square feet in the 128 and 495 North submarkets, accounting for 31.4 percent of leasing activity in the greater Boston office market during the first six months of 2012.
Cole was not the only company to get its hands on an office asset in Boston’s coveted northern suburbs during the second quarter. However, the other acquisitions pale in comparison in terms of dollar amounts. Fairlane Properties picked up the 205,000-square-foot complex at 155 & 159 Swanson Rd. in Boxborough for $18.3 million. Additionally, Entegris, a products supplier to the semiconductor and microelectronics industries, purchased the 80,000-square-foot building at 9 Crosby Dr. in Bedford, with plans to shell out as much as $50 million to transform the property into its i2M Center for Advanced Materials Science.