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BOSTON—The city is experiencing a boom in job growth, particularly in the healthcare and tech segments; low vacancy, especially in the CBD; and an expanding population. With conditions such as these, GlobeSt.com has expanded its coverage of the region, bringing Boston into its collection of dedicated editions.
Welcome to the official launch of GlobeSt.com's dedicated Boston edition, where you will find the latest analysis, deals, trends, forecasts and more on a daily basis. In addition to this daily edition, GlobeSt.com will distribute a weekly digest containing insights and analysis from its editorial team and Boston's movers and shakers.
“Our research revealed that the Boston commercial real estate industry is buoyant, which made it a natural choice for inclusion among GlobeSt.com's new dedicated market editions,” says Michael Desiato, vice president & group publisher of the ALM Real Estate Media Group. “2014 turned out to be Boston's strongest year since 2006 and experts are optimistic that 2015 will be even stronger, so offering a Boston edition allows us to better serve our customers by providing content where it's needed most.”
In preparation for today's launch of the dedicated Boston edition, we exclusively chatted with some of the leading experts on the city's office and industrial real estate markets. They told us that the city's economic diversity that includes strong healthcare, education and technology sectors, helped soften the blow of the recent recession. The city has emerged from the downturn stronger than most and has in fact fully recovered the job losses sustained during the recession.
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“We're currently at 107% of jobs from the 2009 level,” says Cushman & Wakefield research director Sharon Joyce. “We've added about 158,000 new jobs, which brings us to an overall unemployment rate of 4.5%. Technology has been a strong driver of employment, with 11.9% growth over the past five years, some 27,000 new jobs. Our CBD vacancy rate is among the lowest of major US metros at 9.4%. In L.A. they're over 20%.” She adds that due to its strong educational base, as well as robust healthcare, biotech and life science sectors, “We have a full complement of industries in the metro area that allowed us to accelerate out of the recession. Our diversification is a true advantage to our recovery.”
While noting that Boston is an expensive place to live and work, J.R. McDonald, executive vice president of brokerage for Cushman & Wakefield also stressed the importance of the city's diverse economic base.
“The things that drive real estate in Boston and the advantages we have are clearly the amount of hospitals and universities, as well as the established big pharma groups that want to locate here. There's the presence of the universities, which leads to a very strong, available workforce for a lot of the jobs in the tech and innovation fields,” McDonald tells GlobeSt.com. “Those are the obvious drivers, in addition to a historically solid base in our CBD of financial, insurance and law services.”
He adds that Boston is not a regional distribution hub, but instead an end-of-the-line distribution market fueled in large part by e-commerce companies, 3PL companies and carriers such as Fed-Ex and UPS. “E-commerce has really helped with the surge in demand in our traditional markets, which are farther out around the 495 belt,” McDonald says.
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Joyce and Edward Maher, vice chairman of capital markets for C&W, tell GlobeSt.com that Millennials have been critical to the region's growth and will continue to play a major role in years to come. Joyce says that Millennials are driving mixed-use development in the Boston CBD as well as at Assembly Row in Somerville where there is redevelopment initiatives being undertaken on underused land parcels. “The movement is also evident in some of the higher-performing suburban submarkets like 128 West and 128 North, where developers are looking at mixed-use destination campuses with associated retail and entertainment to serve the workforce there,” she adds.
Maher notes that investors are following the movement of Millennials in the Boston area. “If you remember back three or four years ago the Back Bay market was all the rage. Then it shifted to the Seaport District, which [then] Mayor Menino rechristened the Innovations District. A lot of people thought the Financial District was dead and gone. Then those crazy Millennials helped the CBD. Now there's a movement underway to rename the Financial District the Downtown Market, which more accurately reflects the diverse tenant base,” Maher says.
He adds that current Mayor Martin Walsh has extended the Massachusetts Bay Transportation Authority hours to 2 a.m. in the urban areas, which has shifted the focus more to the Downtown Market. Investors have picked up on that and are looking for opportunties anywhere that follows the MBTA Green and Red lines.
GlobeSt.com will present a provactive and insightful look at the latest issues and trends of the Boston regional market at its RealShare Boston event to be held on July 22 at the Omni Parker House from 7:30 a.m. to 12:30 p.m.
Check out the stories below to catch up on recent Boston news as well as more detailed insights on those subjects. Also, don't forget to check back daily for many more exclusive stories from sources on the local market.
Gov. Baker Puts Brakes on Boston Convention Center Expansion
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