WALTHAM, MA—The suburban office market and Greater Boston's weather were both a lot balmier at the June groundbreaking of Overlook Center, but the developers say progress on their 106,000-sf class A building is about to heat up again after receiving $25.5 million in construction financing. Girders will be delivered by February, says Normandy Real Estate Partners principal Justin Krebs, adding he believes leasing commitments will soon follow.

"I think it will pick up very soon," says Krebs in concurring that the suburban market has cooled after a hyperactive three quarters. As it is, he says, Normandy's 3.5 million-sf Boston portfolio has exceeded leasing projections and Krebs reports that properties along Route 128 are entertaining proposals that could end the 2007 campaign on a positive note for that corridor. "We're pretty happy at what we're seeing," says Krebs. Normandy's assets on the loop stretch from Burlington south to Dedham. Including properties in Boston and on Interstate 495, Normandy has leased 650,000 sf to date, well above the 500,000 sf set as its annual goal.

The construction loan from National City Bank "is a great first step" towards completing Overlook Center by the fourth quarter of next year, says Krebs. "We were really impressed with the execution from National City," he relays, especially considering the agitated lending environment. "They proved great to work with." The project is a joint venture between Normandy and Neelon Properties of Waltham.

According to National City SVP James Partridge, the institution resolved to work through the market's financial turmoil and close the loan due to the strength of the sponsors, the project's attributes and the solid fundamentals of the suburban office sector, especially in the core community of Waltham. "We recognized that not only would Overlook bring much needed office space to a crowded market, it would also be bringing an unparalleled product," says Partridge.

Overlook Center's foundation will be installed over the next two months and the steel should start rising by spring, says Krebs, predicting that the requirements circling Overlook Center will become more focused once the shell takes shape. Although the frozen, snow-capped site shows no visible signs of progress, Krebs insists there is plenty of action behind the scenes, with prospects being drummed up by Jones Lang LaSalle broker Alex Dauria.

"We've had some good discussions, and we think those will really get serious after the first of the year," he says. The pending lease-up of the Boston Properties spec building at 77 CityPoint in Waltham and the just-announced 270,000-sf lease by National Grid at nearby Reservoir Woods removes a pair of formidable competitors, notes Krebs, adding that the project should further benefit from a general lack of new construction compared to tenant demand.

After previously structuring the equity partnership between Neelon and Normandy, Thomas Ikeler and James Gladden also helped arrange the construction financing. "This loan is critical to moving the project forward and it is a true testament to the value that we will be delivering to the market," says Krebs. Abundant natural light, efficient floor plates and amenities such as a café, fitness facility and conference center are among the features expected to help Overlook Center lease at the top of the Waltham scale. Class A space there is presently achieving rates in the mid-$40's per sf and reportedly escalating into the $50's for long-term transactions.