Amenities Seen as Key Tool in One Edgewater Dr. Lease

NORWOOD — Faced eternally by homegrown competition, suburban office landlords now must address the very real threat of in-migration, the pro­cess by which companies are embracing Boston and Cambridge as their solution to chronic talent droughts of coveted millenials, a generation who enjoys a downtown milieu or at least ac­cess to work via public transportation. About the only thing helping stem the shift is by rep­licating the all-in-one nature of a city setting, and it is that strategy NAI/Hunneman brokers say is paying off for One Edgewater Dr. own­er Iconic Capital, whose founder Jeremie Lederer bought the 90,000-sf building a foreclosure auction in August 2014. Once in control of the asset which he purchased for $5.8 million, Lederer took swift action to re-stabilize the asset, re­counts NAI Hunneman Vice President Ovar Osvold. “It has the level of amenities you usually only find in a 300,000 square foot building,” the broker tells Real Re­porter in the wake of a lease signing col­league Catherine Minnerly and he nego­tiated as exclusive agents of the building which is part of the Route 128 South sub­market where their team is focused.  Turning 30 a year after its purchase, One Edgewater Dr. was gussied up on the out­side and transformed even more dramati­cally inside in being endowed with a brand new lounge and cafeteria, free WiFi for all common areas and a modern fitness center featuring state-of-the-art equipment, flat screen televisions and lockers plus show­ers. “The amenities have really helped tip the scales there,” opines Osvold, and while part of the sales pitch is quick access to such nearby attractions as the Legacy Place lifestyle center on Route One in Dedham and Westwood Station, “it can make a big difference when a tenant doesn’t have to go outside in the middle of winter to get a sandwich or work out,” he says, and One Edgewater Dr. has that opportunity avail­able for firms taking a little as 2,750 sf.  In that regard, One Edgewater Dr. is right-sized for companies under 10,000 sf, says Minnerly, a constituency which makes up the majority of leasing velocity but might “feel lost” in a more cavernous environ­ment if they are accommodated in the first place. There is also room to grow, she out­lines, with contiguous space of 25,000 sf in place. Occupancy was at 50 percent when they were awarded the assignment this past spring, and the brokers report after a measured pace among tenants through the summer and early autumn, activity at the building is proceeding quickly to where the one lease has filled 5,875 sf and several oth­er deals are approaching a conclusion. “It has been a lot of work, but people are more responsive now, and I think we are going to have some good things happening in 2017,” says Minnerly. The committed tenant is Aurus, a credit card processing firm which is retaining a Boston office at 33 Arch St. while opening its new opera­tion at One Edgewater Dr. Minnerly and Osvold advised the landlord, 1 Edgewater Drive Associates LLC, while P.J. Foster of Colliers International represented Aurus. Other demand is coming from varied camps, many sticker-shocked tenants in the suburban-leading Route 128 Central submarket looking to the south and west and increasingly there are companies be­ing pushed out of the urban core by the amped-up rents in the Hub’s Back Bay and Seaport or across the river in Cambridge. In that mix are biotech companies con­sidering suburban office locations to put non-essential workers. Compared to the $100-per-sf agree­ments being approached in Kendall Square, and even $50-per-sf cropping up in the Waltham and Wellesley office clus­ters, One Edgewater Dr. looks especially attractive with deals being pitched in the low $20’s per sf. “It is a major advantage,” says Osvold. Financial details of the Aurus lease were not provided, but fresh NAI/ Hunneman research puts the average ask­ing rent for Route 128 South at $21.00 per sf versus $34.70 in Route 128 Central with the Route 128 average at $27.98 per sf. On the strength of 250,000 in positive net absorption last year, the Route 128 South inventory of 14.3 million sf saw vacancy drop to 10.9 percent.

-The Real Reporter