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MARLBOROUGH, MA-Accentuating a solid beginning to 2007 in the Interstate 495 West office market, Xcellerex Inc. has committed to 61,000 sf at 150-170 Locke Dr. in a lease renewal/expansion that takes up more than half the facility. The 120,000-sf building, which serves headquarters for the life sciences company, is owned by Boston real estate investment firm Davis Marcus Partners.

“It’s great to have a company with such exciting technology as Xcellerex in the building, and to be able to watch them grow and become more successful,” DMP chief executive Jonathan Davis tells GlobeSt.com in acknowledging the lease. Davis says he believes it also validates his company’s belief in the MetroWest commercial real estate market displayed when the company acquired 140 and 150-170 Locke Dr. for $3.4 million and $8.9 million in March 2006. DMP also paid $10.9 million for the adjacent 111 Locke Dr.

“We thought the marketplace was firming and demand was increasing, and that seems to be what we are seeing happen there now,” says Davis of the investment. That notion is seconded by Richards Barry Joyce & Partners VP Paul Leone, who represented the landlord along with RBJ principal John Lashar as exclusive leasing agents for the DMP properties. According to Leone, the I-495 West region has parlayed one of the best quarters in years to start 2007 into continued improvement during the second quarter. “It has been a breath of fresh air,” says Leone, especially given that the 16.7-million-sf office market has been bogged down in a stagnant economy for much of the decade. Even now, the inventory has a vacancy rate of 17.9%, and plenty of assets remain empty or underutilized.

While the halcyon times have yet to return fully to I-495 West, Davis and Leone both predict the pace of recovery will quicken as the year progresses. Leone says a “great sign” has been the number of smaller and mid-sized companies out seeking space, and not just to replace an existing requirement. Many who took 5,000 or 6,000 sf in the past cycle are seeking three and four times as much this time around, says Leone. “That’s really helpful when you have activity at that end of the spectrum,” says Leone, noting that I-495 West has been known as a destination for big users needing rental relief or significant blocks of space to accommodate growth. The moderate-sized requirements can offer an added layer of velocity, says Leone. “We’re very encouraged by that [trend],” he says.

In that vein, 140 and 150-170 Locke Dr. have been a good fit, says Leone, explaining the buildings were designed to sub-divide efficiently to serve a multi-tenant platform. The Xcellerex pact brings 150-170 Locke Dr. to full occupancy save for sublease space being marketed by a couple of tenants. Occupying a mix of manufacturing and office space, Xcellerex expanded by 21,000 sf and extended the lease term by six years. The tenant was represented by RBJ President Robert Richards and Michael Frisoli, while DMP provided in-house guidance from William McAvoy and Duncan Gilkey.

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