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WOBURN, MA-One of the region's most enduring commercial real estate firms has received $10 million in refinancing on a five-property, 260,000-sf portfolio here in suburban Boston's northern submarket. Fully occupied, the industrial buildings are owned by MDG Realty Co., an affiliate of the Begley Cos., whose roots in Woburn date to 1950.
The loan was obtained from John Hancock Life Insurance Co. through Holliday Fengolio Fowler's New England office. “The MDG industrial portfolio is great real estate,” says HFF director Anthony Cutone in announcing the agreement. “The Begley Cos. has done a terrific job keeping the properties well-maintained and well-leased.” Cutone, who worked with Begley Cos. president Doug Porter on securing the loan, praised both the borrower and lender for “a smooth execution” despite the upheaval in the capital markets that began to take hold in August.
Included in the quintet of properties is the Begley Cos. headquarters at 185 New Boston Rd. The others are 17 Everberg Rd., 13 Linscott Rd., and 161-171 Merrimac St. According to Cutone, the buildings are cross-collateralized, with release prices enabling the pre-payment and release of the assets individually. HFF will also service the loan for the Begley Cos., which owns several other commercial properties in the area.
Despite a sluggish year to date, the North industrial region including Woburn is the second tightest among seven Massachusetts submarkets tracked by Jones Lang LaSalle. Its vacancy rate of 8.5% through three quarters is less than half the overall rate of 17.4% for the inventory of 62 million sf covered in the JLL survey. The Interstate 495 North submarket, by comparison, presently has an industrial vacancy rate of 30.2% for its 7.9 million sf.
The average asking rental rate in I-495 of $5.27 per sf is well below that of the North region, which is estimated at $7.36 per sf, second only to the $9.59 per sf found in the tiny Route 128/Massachusetts Turnpike submarket and above the average rate of $6.14 per sf for the total market. The North has not seen much action to date in 2007, however, posting 81,000 sf of negative net absorption through three quarters for an inventory of 10.8 million sf. The industrial market as a whole had 134,000 sf of positive absorption through Q3, bringing the mark to plus 490,000 sf for the year to date, according to JLL.
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