Dear Havas: Welcome to the Neighborhood!

Havas Welcome

by Timothy Lyne, Executive Vice President/Partner, Urban Brokerage

Monday marked another major milestone in Millennium Partners’ project in the heart of Downtown Crossing. Havas Media/Arnold Worldwide celebrated its first day at the newly-renovated Burnham Building, amidst a welcoming party full of red balloons, a brass band and lots of DTX neighbors dropping by to say “hello.”

Here at the CBRE/New England Boston office, we have been enjoying watching the project advance and excitement build; steel frames turned into large glass window facades, classic signage adopted a new look, and the ‘hole in the ground’ disappeared below the rapidly growing Millennium Tower. Havas is a key catalyst in the transformation of the DTX neighborhood, jumpstarting the development by signing the first lease at Millennium’s proposed project. Continuing the momentum, AOL, Primark and Roche Bros. all signed on to move to the Burnham Building. The progress hasn’t stopped there, as the surrounding area continues to see new retail, restaurants, residential and corporate neighbors.

Check out the photos below of some highlights from Monday’s event. Photos courtesy of the Downtown Boston BID and Millennium Partners.

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High-Tech Industry Growth Powers Strong Rent Increases in Boston Over Past Two Years

CBRE’s latest research report, U.S. Tech-Twenty: Measuring Office Market Impact, tracks high-tech employment and office market conditions in 20 tech-oriented office markets across the U.S., including Boston, and found a strong correlation between high-tech job growth and accelerating office rents. From Q2 2012 to Q2 2014, Boston experienced 15.7% growth in high-tech jobs, while office rents grew by 11.2% during the same period.

“The Boston market continues to evolve as a hub for innovative high-tech companies seeking value and access to 24/7 amenities,” added Kevin Kennedy, First Vice President of the Urban Brokerage group in Boston and member of the CBRE Technology & Media Practice with a focus on New England. “Co-working/incubator companies are continuing to expand, indicating growing support of high-tech companies who desire to be in the Seaport District and CBD, in addition to Cambridge.”

The full report and its local market summary pages can be accessed here.


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#WednesdayWisdom: Rhode Island Mid-Year MarketViews

Providence, Rhode Island (iStockphoto)

Rhode Island Office (click to download) 

The beginning half of 2014 ended with the Downtown Providence Office vacancy rate decreasing to 15.07% from 16.20% at the end of 2013. There were several transactions that impacted this result including the purchase of the 25,253 sq. ft. 180 South Main Street by the Rhode Island Attorney General’s Office and the sale of the 20,000 sq. ft. 189 Canal Street to Rhode Island School of Design. This removed ±45,253 sq. ft. of vacancy from the market.

Rhode Island Industrial (click to download)

At mid-year 2014, the Rhode Island Industrial market vacancy rate is 7.9%, down 106 basis points from 9.03% at year-end 2013. Significant leasing and sales activity contributed to the strong reduction. The overall size of the Rhode Island Industrial market increased slightly with the addition of 175,000 sq. ft. for a total market size of 52,424,000 sq. ft. There was positive net absorption of 869,454 sq. ft. in the first half of 2014, compared to 23,894 sq. ft. in the second half of 2013. The Rhode Island industrial market continues to see improvement in many areas and increased tenant activity in all size ranges. With vacancy down and absorption up significantly, the industrial market is trending to a much healthier overall condition. The limited supply of quality inventory for both sale and lease product will present a challenge for prospects as we move forward into the second half of 2014.


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Take Your Stats To Go: CBRE/NE MarketViews are Mobile!

CBRE/New England provides mobile-friendly MarketViews for your iPhone, iPad, etc. This format gives you quick, mobile access to all of the CBRE/NE Quick Stats, Hot Topics and MarketViews for when you’re on the go. Click here to view on any of your mobile devices.


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#FrontierFriday: DTX in Demand

Millennium Tower's plaza will include an amphitheater and shoppers' park. Rendering courtesy of Millennium Partners and Handel.

Millennium Tower’s plaza will include an amphitheater and shoppers’ park. Rendering courtesy of Millennium Partners and Handel.

by Timothy Lyne, Executive Vice President/Partner, Downtown Brokerage

Next up in our emerging market exploration is Downtown Crossing. Having an edge on other growing areas, DTX has been exhibiting steady momentum since Havas/Arnold Worldwide announced plans to relocate from the Back Bay, kicking off Millennium Partners’ mixed-use project of the rehabilitation of the Burnham Building and new construction of Millennium Tower. Here are some highlights of why DTX is becoming the next Boston frontier:

Power of the Red Line: Access is excellent, however direct MBTA Red Line access is icing on the cake, a vital requirement for tech tenants and especially those migrating from the ever-tightening Cambridge submarkets.

Refreshing Restaurants: New establishments continuously open, from fresh daytime options such as Caffe Nero and Pret A Manger, to nightlife-enhancing destinations such as Legal Crossing and Merchant.

Historic Retail: Taking the majority of available space left at the Burnham Building, European retailer Primark signed a lease during the second quarter for 110,000 square feet of office and retail space, while last year Walgreens opened a flagship location on School Street that filled the vacancy left by Borders. Most notably, Downtown Boston will gain its first large-scale grocery store, with Roche Brothers opening a 25,000 square foot store across the Burnham Building/Millennium Tower.

Residential Fury: Downtown Crossing is a prime example of the extremely active residential market, with new towers such as Radian Boston, The Kensington, Millennium Tower and Millennium Place.

Tenant Trends: With these increases in amenities and market buzz, Downtown Crossing has become increasingly popular for tenants. Technology companies, start-ups and tenants priced out of the Seaport and Cambridge have found affordable options in DTX, dropping the average Class B vacancy rate in the DTX area to just under 5%. Class A assets are also seeing healthy activity, as seen by many recent deals at buildings such as 101 Arch Street and Lafayette City Center.


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