MetroWest Office Vacancies Rose In 2Q2012
Vacancies in the western Interstate 495 region climbed 1.2 percent to their highest level in two years in the second quarter, fueled by Fidelity Investments departure of one of its smaller Marlborough locations, according to real estate firm Richards Barry Joyce & Partners.
Boston-based Fidelity vacated a 130,000-square-foot location at 397 Williams St. during the quarter, said Brendan Carroll, senior vice president of research for RBJ&P.
"That was the major factor in that 1.2-percent increase in vacancy we saw this past quarter," Carroll said.
Fidelity Migration, Part II
The vacating of Williams Street was the second piece of a plan Fidelity announced in 2011, which served to shed properties and leases and move jobs to New Hampshire and Rhode Island.
Fidelity had leased the Williams Street property since 2006, according to the Middlesex South Registry of Deeds.
In April, Fidelity sold its 600,000-square-foot Puritan Way campus in Marlborough to Framingham-based TJX Cos. for $62.5 million.
Vacancies in the western 495 region office market, which contains “the Boroughs,” Framingham, Natick and Maynard, now stand at 18.3 percent, compared to an overall Greater Boston rate of 15.5 percent.
"So it's a little bit higher than that, but it's very reined in when compared to the much higher vacancy rates the market experienced following the tech bust," Carroll said.
Those tech bust rates were around 30 percent in the MetroWest market in 2000.
Average Class A asking rents fell 33 cents to $20.79 per square foot.
Marlborough has the highest office vacancy rate at 25.9 percent, followed by Westborough at 16.6 percent. Maynard, which has a relatively little rentable office space, has a 22.4-percent vacancy rate.
Framingham sits at 10.7 percent. The town has been a surprisingly strong performer over the years, Carroll noted. Its 15-year-average vacancy is 9.2 percent. While many might think of Waltham as a more high-end, desirable office market, Carroll said that community has averaged 18-percent vacancy over the past 15 years.
"Framingham has been very desirable," he said.
The second quarter saw more space vacated than leased, known as "negative absorption," for the first time in a year, RBJ&P said in its report.
Leases during the quarter include OneShield's expansion from Westborough to 30,000 square feet on Forest Street in Marlborough and TransCanada Power's lease of 20,000 square feet on Turnpike Road in Westborough.
The largest available office spaces include 4400 Computer Dr. in Westborough and 500 Old Connecticut Path in Framingham.
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