"We're seeing a lot of people coming through," acknowledges Beal VP Robert Doherty, the most recent being NextJump, a burgeoning technology firm that will relocate from smaller suburban quarters into 22,000 sf on the fourth floor of Building 200. The seven-year pact will repopulate space previously occupied by Draper Laboratory, which is joining long-time occupant Genzyme Corp. in departing for a custom-built operation. Genzyme is giving up about 165,000 sf in the 11-building, 675,000-sf complex, but Doherty reports solid progress backfilling that space.
Assembled from a one-time industrial facility that dates to the late 19th century, One Kendall Square offers an eclectic mix of laboratory, office and retail in a series of interconnected buildings and featuring courtyards and other unique elements. The enclave also includes a 1,500-vehicle parking garage and multi-screen theater.
The NextJump pact brings Building 200 to full occupancy. Buildings 600 and 700 have the most empty space with about 130,000 sf, but Doherty says he is encouraged from the response by prospective tenants. One reason could be super-tight vacancies in the core East Cambridge market. According to Q1 figures from Jones Lang LaSalle, the 10.4-million-sf Cambridge office market has a vacancy of just 8.8%, while the 6.9-million-sf lab sector is at 10.2%.
About 60% of the available space at One Kendall Square is lab, says Doherty, much of it second-generation facilities that seem to appeal to small- and mid-sized startups hoping to remain in Cambridge without paying the escalating rates attached to newly built product. "That's really our sweet spot," says Doherty. JLL estimates the average asking rate for lab space in Cambridge is $53.63 per sf, but newer buildings have achieved deals closer to the $70 per sf level.
The owners of One Kendall Sq. are not relying on desperate tenants to fill the existing space, however. Launched last autumn, the capital improvements effort is being undertaken to create a more cohesive feel to the property, explains Doherty. That means uniform signage, revitalized facades, upgraded lighting and extensive landscaping to improve the asset's "curb appeal," he relays. The new look is being carved out of a plan advanced by Elkus/Manfredi Architects, one of New England's top design firms. Richard White & Sons is implementing the overhaul, which Doherty estimates will be completed by the end of the year.
Doherty says he anticipates a busy spring, a confidence stemming partly from the plentiful prospects. There are eight or so serious requirements in play, he says, tenants with an aggregate of about 150,000 sf in demand. But even with the renovation still ongoing, the recent space of leases has already solidified the tenant base. Besides NextJump, represented by broker Dick McCarte of Nagog Corporate Services, One Kendall Square also recently renewed tenant iZotope for 4,000 sf and Abcam for 17,000 sf, plus signed Quanterix Corp. for 10,000 sf in Building 1400. Harvard Medical School also re-upped for 24,000 sf at One Kendall Square.
Beal and Rockwood were represented in all of the leasing transactions by Doherty and SVP Michael Manzo. Mark Cote of T3 Realty Advisors was broker for Abcam, Tucker Hanson of Meredith & Grew negotiated terms on behalf of Quanterix, and Harvard was represented in-house by Rick Mills.
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