Medical Firm Launches 150,000-SF Lease Search

BURLINGTON, MA-Yet another six-figure requirement has entered the suburban Boston office market, with industry sources reporting that Palomar Medical Technologies is in a search for 150,000 sf. The firm is located at 82 Cambridge St. in Burlington, and would reportedly more than double in size from about 60,000 sf occupied at present.

“They are definitely out there,” acknowledges one industry professional, adding that Meredith & Grew has been retained to assist the firm in securing an agreement. M&G AVP Elias Demakes and colleague John Carroll III are said to be overseeing the assignment for Palomar. Demakes declined to discuss the matter when contacted by GlobeSt.com, citing client confidentiality, while efforts to contact Palomar officials were unsuccessful. Palomar produces devices for use in skin treatment.

Given the silence, it is unclear how expansive the space search is, or whether Palomar is focusing on pricing or is more concerned about the quality of the future facility. Some observers, however, say the pursuit seems to be focused on the Route 128 Northwest submarket anchored by Burlington. At least one other major medical sector requirement has been eyeing that region as well of late, with GlobeSt.com last week reporting that Phase Forward has supposedly considered options in the Burlington and Bedford areas in a search for more than 100,000 sf. Phase Forward is presently in an expiring sublease situation just south of Burlington in the core Waltham market.

Whatever Palomar’s motivation or outlook, the decision-making process might do well to quicken the pace considering the increasingly snug suburban office market, especially along Route 128 NW. Estimated at 20.9 million sf by M&G’s SVP Mary Kelly, the real estate firm’s research director, Route 128 NW saw its vacancy rate drop from 21.8% to 20% during the first half of 2007, with just under one million sf of net absorption in that time. More than 780,000 sf of that activity occurred in the second quarter. The next closest performer was the Interstate 495 North submarket at 350,000 sf for the quarter.

Burlington is especially hot, with Kelly estimating that the vacancy rate dropped from 18.1% to 14% during the first half of the year. Although the market still represents a value compared to Boston, Cambridge and Waltham, Kelly advises in M&G’s mid-year Market Viewpoint that a “considerable discount in pricing witnessed six months ago is narrowing with each passing month” for all of Route 128NW.