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.
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.
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.