Occupancy Could Hit 90% With New Leases at Arsenal on the Charles

Within the past few weeks, three firms have committed to nearly 27,000 sf of space which would bring the year's total leasing up to 168,000 sf. Bob Doherty, vice president of the Beal Cos. which represents Harvard in its leasing at the Arsenal, tells GlobeSt.com that even more recently, two letters of intent have been signed for 165,000 sf of space. Doherty declined to reveal the names of the tenants, but he says one firm is relocating from the suburbs to lease 110,000 sf while the 55,000-sf space is going to a fitness facility. Doherty notes that there are actually two fitness facilities vying for the 55,000-sf location and while one has been chosen as the tenant the other is available if the first deal doesn't go through. He points out that with the new commitments, the occupancy rate of the Arsenal will be up to 90%.

Both tenants are taking space at 311 Arsenal St., in the building that was vacated by Arthur D. Little when it went bankrupt shortly after Harvard acquired the property. The three recent deals that were signed include A123 Systems, Inc., which is leasing an 11,000-sf free-standing building for its corporate headquarters at One Kingsbury Ave. The company, which develops batteries for cell phones, is relocating and expanding from the Boston University photonic lab. Doherty says that the average asking rate for this type of space in the area is approximately $25 per sf. Roy Hirshland of T3 Realty represented A123 in the transaction.

In the second deal, Communispace is leasing 9,000 sf at 100 Talcott St., a 65,000-sf building. The company, which develops software for online web portals, is relocating and expanding within the Arsenal from space it was subleasing from Bright Horizons at 200 Talcott St. Bright Horizons is taking back the space. Ted Lyon of Trammell Crow Co. represented Communispace in the deal.

In the third deal, Green Beacon Solutions is also leasing space at 100 Talcott St. The company, which was subleasing space from Financial Fusion at 400 Talcott St., is leasing 6,145 sf at its new location. Financial Fusion is taking back the space. Mark Cote of T3 Realty represented Green Beacon in the deal.

The Arsenal on the Charles is the largest speculative office redevelopment in the Greater Boston area. When Harvard bought the complex for $160 million it was a controversial move as the town had spent millions fixing up the site, banking on the property tax revenue. It objected to its ownership by a tax-exempt educational institution, but eventually the university worked out a deal with the town if it converts the site to educational use. The local market in general continues to struggle to fill its space with the overall availability rate as high as 28% according to recent statistics.