LEXINGTON, MA-The migration of tenants from Cambridge to the Rte. 128 Central submarket has continued with the relocation of Tepha Inc. from 840 Memorial Dr. to One Ledgemont Center. Owned by the Beal Cos. of Boston, the 180,000-sf, class A office building is located just outside Cambridge at the junction of Rtes. 2 and 128.

“We are delighted that Tepha chose One Ledgemont Center as their new corporate headquarters,” Beal SVP Michael Manzo says in announcing the tenant’s relocation into 20,000 sf. “We look forward to a long-term relationship and to Tepha’s continued growth and success.” The medical devices firm focuses on implantable products for use in surgery, regenerative medicine and drug delivery. The company recently won FDA approval to market a new suture, and has more than 40 patents related to proprietary technology.

Tad Lee of Meredith & Grew negotiated the lease for Tepha, while DTZ FHO Partners is listing agent for One Ledgemont Center. DTZ FHO principal John Boyle says he believes the Class A facilities, combined with close proximity to Cambridge and downtown Boston, were prime reasons for the building’s selection, as well as the on-site management team. “Tenants today are looking for quality and value,” says Boyle, who teamed with colleague Kim Roop to handle the Tepha assignment.

While unclear whether it played any role in Tepha’s decision, tenants are also departing Cambridge due to a substantial price differential, especially now that rents in core markets such as East Cambridge are rapidly accelerating as a result of the improved economy and a dwindling of inventory for both office and laboratory needs. Other life sciences tenants either now in the Rte. 128 Central market or looking to be there include AstraZeneca, Praecius Pharmaceuticals and Shire Pharmaceuticals.

Although rents in top Waltham space is now exceeding $40 per sf, the overall rate is generally below that found in Cambridge. According to mid-year figures from Jones Lang LaSalle, Cambridge averages $39.94 per sf at present, compared with $30.37 per sf in Rte. 128 Central. The delta is expected to widen, with reports of some Cambridge office deals now being struck above $70 per sf, albeit in select instances. There is also a gap in office vacancies, with Rte. 128 Central at 10.2% and Cambridge down to 7.1%.

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