Marlborough Sale Shakes MetroWest Market
The sale of The Campus at Marlborough — a complex of three fully-leased, high-quality office buildings totaling 530,000 square feet — for $103 million to a Houston-based investment real estate firm marks the latest major development in the erratic MetroWest commercial real estate market.
Hines Global REIT purchased the three buildings and empty land that could house up to 650,000 square feet of new development from Bel Marlborough I and Bel Marlborough II LLC, groups associated with Boston real estate investment firm Eaton Vance.
The sale of The Campus adds to the complexity of the market in Marlborough. Adjacent to The Campus is the former Hewlett Packard manufacturing plant and next to that is the Fidelity campus, both of which will be vacant by the end of next year, leaving more than 1.2 million square feet of empty space along I-495.
“Marlborough seems to be talked a lot about nowadays,” said Christopher Tosti, executive vice president and partner at CB Richard Ellis, which is marketing the HP site. “There is a lot going on there.”
Tosti and other officials in MetroWest are playing down the notion that The Campus sale will disrupt the market. Because the building is fully leased, the sale does not have any direct impact on other nearby properties.
“They’re apples and oranges,” Tosti said.
Notably, the HP and Fidelity sites are large, vacant or soon-to-be-vacant campus-style buildings, whereas The Campus is a large, fully-leased multi-tenant building.
But officials with Hines are marketing the undeveloped space there on a build-to-suit basis, meaning it will be developed if and when the right tenant comes along.
HP officials are doing the same.
Tosti said the HP site could be used for a variety of purposes, from a single-user, campus-style setup to a multi-tenant arrangement.
David Perry, a senior vice president in the Hines Boston office, said the undeveloped land at The Campus is equally flexible.
Hines has been operating in New England since the 1980s, focusing mostly on suburban office development in the Boston and Cambridge area.
Perry said The Campus has had steady lease activity, even during the economic downturn of the past few years. All of the three-building Campus complex is Class A, high-quality office space.
According to Boston-based firm Richards Barry Joyce & Partners, Class A space has rented at nearly twice the rate as lower-quality Class B and C space so far this year.
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