By Anthony Warren, Senior Vice President, Jones Lang LaSalle
BOSTON -- Everyone involved in office space, owners and property managers as well as tenant office managers and employees, has a shared responsibility for reducing the environmental impact of our business activities. In commemoration of Earth Day’s fortieth birthday, here are 40 ways to make the office a greener place to work:

By Joe Sciolla, Managing Principal, CresaPartners
BOSTON--After being mired in this lingering Great Recession, we are all eager to move on and embrace another “R” word. But it’s hard to talk about a recovery if the patient—commercial real estate—is still bleeding. While it’s “good news” that the Boston market may be declining at a slower rate, we need to avoid wishful thinking and look at reality.

By Bill Goade and Brant Bryan

 

Potential changes in lease accounting may have seismic consequences for the balance sheets of public companies:  Operating leases will likely be replaced by capital leases, shifting trillions of dollars to balance sheets of companies worldwide.  With all leases for commercial real estate being capitalized this way, the debt of most companies will increase dramatically. 

By Dwight S. Patten

 

(Dwight Patten is Director of Project Management at CresaPartners Boston.)

 

BOSTON--Green has become the corporate color of choice.  More and more companies are realizing that sustainability will help the environment and the workplace now that “going green” has become mainstream. 

by William P. Barrack

(Mr. Barrack is Managing Director, Brokerage Group, of the Boston office of Jones Lang LaSalle. This article is reproduced here from the firm's Real Estate Market Intelligence Monthly.)

Boston has less exposure to the subprime lending industry than other metro areas and should be able to weather the storm due to healthy employment growth in technology, consulting, and legal services. The other bright spot for Boston is the lack of new supply in the office market which will keep vacancy rates in check. 

By Dan Sullivan and Adam Subber

 

CAMBRIDGE, Mass.--Strong tenant demand and record levels of Wall Street capital have helped trigger record commercial real estate rates in Cambridge.  Led by The Blackstone Group, which purchased Equity Office Properties, giant investors have brought a new mindset and new dynamics to major markets across the country—and Cambridge is a prime example.  These groups, flush with capital, are gobbling up trophy properties.  In the process, they have consolidated much of the market, and they are pushing the envelope regarding office and laboratory rents.

By Joe Sciolla

 

(Mr. Sciolla is Managing Principal at CresaPartners in Boston, New England’s largest corporate real estate advisory firm focusing on tenant representation and corporate services.)

 

Wall Street investors like The Blackstone Group, Broadway Partners, Normandy Real Estate Partners, and Beacon Capital Partners have been enjoying quite a ride in Boston, as rents and vacancies have reached respective highs and lows not seen in more than six years:  Average asking Class A office rents in Boston have climbed from $47 per square foot in the first quarter to $52/SF at the close of Q2, while office vacancy has dropped to 10%.  More dramatically, some high-rise asking rents in the top floors have reached $90/SF, and vacancy in the Financial District and Back Bay for Class A space is about 6%.

by Dan Cordeau

 

(Mr. Cordeau is senior vice president at the Boston office of Jone Lang LaSalle. This article is reproduced from the firm’s The Real Estate Market Intelligence Monthly.)

 

The biotechnology sector experienced a dynamic first quarter of 2007.  Across the country, $1.5 billion (or 21% of all venture capital funds invested) was invested into the biotechnology industry with Cambridge representing 18.5% or $275 million. 

by Lauren Picariello

 

(Lauren Picariello is Research Manager at the Boston office of Jones Lang LaSalle. This article is reproduced here from the firm’s May 2007 issue of the Real Estate Market Intelligence Monthly.)

 

The U.S. economy, although growing, cooled off over the last half of 2006 and through the first quarter of this year.  GDP grew at an annual rate of 0.6% over the first quarter after recording 2.5% annual-adjusted growth in the fourth quarter of 2006.  Growth was a result of increases in consumer, state, and local government spending. 

by Dan Cordeau

 

(Mr. Cordeau is senior vice president at the Boston office of Jones Lang LaSalle. This article is reproduced here from the firm’s Real Estate Market Intelligence Monthly.)

 

BOSTON--The Cambridge lab market lead the charge in the fourth quarter, as sustained demand for lab space pushed annual net absorption to an all time high of 716,000 square feet.  First generation asking rents reached levels not seen since 2002 ($60.00 to $65.00 per square foot NNN) and availability dropped 5 percentage points to 12% at year-end. 

 

Despite the limited supply of existing large blocks of space available, large tenants remain active in East Cambridge.  Microbia leased 100,000 square feet at 301 Binney Street, a 420,000-square-foot lab development scheduled for completion later in 2007, while Schlumberger pre-leased 114,337 square feet at One Hampshire Street, completed during the fourth quarter of 2006.

NEEDHAM, Mass.- NAIOP Massachusetts, the Forum for Commercial Real Estate, supports legislation filed by the Patrick Administration that would provide the Massachusetts Department of Environmental Protection with the statutory authority to exempt landlocked tidelands from the Chapter 91 licensing process. 

 

An Act Regarding the Licensing Requirements for Landlocked Filled Tidelands was filed yesterday in response to the recent decision by the Supreme Judicial Court in the Moot vs. DEP case that required the Legislature to formalize an existing regulatory exemption that landowners have depended on for nearly 20 years

By Joe Sciolla

 

BOSTON--For four consecutive quarters, vacancy for office space in Boston has declined slightly while rates have inched upward, a trend we expect to continue at a slow and deliberate pace for the foreseeable future.  Downtown vacancy now stands at 12%, basically a state of equilibrium for the commercial real estate market, or one in which tenants might still wield a bit more leverage. Yet major landlords seem to have a different perspective:  They’re starting to push the envelope in an attempt to wrest control away from tenants, who have enjoyed their pick of space and terms for years.

 

In this environment, it is important for corporate tenants to study the true dynamics of the market and challenge overzealous landlords, who may be setting prices that exceed their value while they also attempt to slash tenant concessions.

 

A Level Playing Field?

 

The fact is that eight landlords now control approximately 84% of the market in the Financial District and the Back Bay.  Equity Office (8.5 million SF), Tishman Speyer (2.6 million SF), Beacon Capital (4.2 million SF), Boston Properties (2.5 million SF), Brookfield Properties (1.9 million SF), Chiofaro Company (1.8 million SF), Rose Associates (1.1 million), and SITQ/Immoblier (785,000 SF) account for a combined inventory of 23,560,000 million SF of Class A office space in a downtown market with a total of 28 million SF.  (See attached for breakdown.)

by Robert Kasvinsky

 

(Mr. Kasvinsky is Vice President--Research, and Managing Editor of Spaulding & Slye’s Market Intelligence Monthly. This article is reproduced here from July 2006 issue.)

 

Office: Rents surging in certain market segments.  The most recent employment data for the last twelve months show a gain in core office-using employment of 2.1% and 23,700 new jobs overall. This has continued to fuel net absorption in Greater Boston, which totaled nearly 1.3 million square feet in the first six months of 2006.  Boston, Cambridge, and the Suburbs each recorded positive net absorption. After a promising first quarter, leasing activity slowed in the second quarter compared to the pace at this time last year, but remains well above the long term average for Greater Boston.

by William P. Barrack

 

(Mr. Barrack is Managing Director, Brokerage Group, at Spaulding & Slye. This article is reproduced here from Spaulding & Slye’s Real Estate Market Intelligence Monthly.)

 

With six consecutive quarters of positive net absorption, market conditions in Boston’s Class A tower market continue to tighten and lead the overall office market recovery in Boston.  Over the last year, tenants in the tower market have absorbed a net of nearly 1.5 million square feet. The availability rate has decreased for six consecutive quarters to 13.8%, while the vacancy rate has dropped to the single digit levels to 8.5%. Growth in the tower market is predominantly occurring in smaller increments, from tenants in the sub-25,000 square foot range that have steadily chipped away at the large blocks of space in both the high-rise and low-rise segments of the market.

By Joe Sciolla

 

(Mr. Sciolla is President of CRESA Partners Boston, a corporate real estate advisory firm focusing on tenant representation and corporate services, including project management, lease administration, and capital markets.)

 

BOSTON--As vacancy in Boston has dropped a couple of points to 14%--the fourth consecutive quarter showing a tightening of office space--rents continue their slow rise, up to an average asking price of $41 per SF for Class A and $27 per SF for Class B, both figures a dollar higher than in Q3.  But the rising rents aren’t just a function of supply and demand, according to CRESA Partners in our firm’s latest market update.  As a result not only of the recent hurricanes, but also significant global market shifts—chiefly greater demand for oil in India and China—tenants can expect many new challenges in the New Year.

by Bill Collins

 

(Mr. Collins is Senior Vice President, Boston Brokerage, at Spaulding & Slye Colliers. This article is reproduced here from Spaulding & Slye’s Real Estate Market Intelligence Monthly.)

 

The landscape of the legal profession has shifted dramatically over the past two years to a “bigger is better” strategy. This strategy has emerged among law firms nationwide due to a need to service larger clients, recruit better staff, and extend their reach globally to specialty areas. With 45 law firm mergers completed year-to-date nationally, merger and acquisition activity specific to law firms echoed this trend in 2005. Though the number of mergers is comparable to 2004 (47 transactions at year-end), 2005 merger activity is notable in particular due to the size of the resulting firms.

(Mr. Barrack is Principal, Brokerage Group of Spaulding & Slye. This article is reproduced from Spaulding & Slye’s Real Estate Market Intelligence Monthly.)

 

With four consecutive quarters of positive net absorption, Boston’s class A tower market has absorbed an astounding 2.0 million square feet in the last twelve months. This faster than expected rate of absorption has dropped the availability rate nearly six-percentage points from a year ago to 15.2%, while the vacancy rate continues to tease single digit levels at 10.6%. The positive absorption in Boston’s tower market has outpaced job growth in typical office-using sectors over the past year, suggesting that occupancy gains have been largely a result of companies signing leases to accommodate future growth plans, and several out-of-market tenants relocating to the towers to take advantage of the favorable market conditions.