This article will help anyone looking for information pertaining to a commercial real estate and commercial lending in the State of
The Port of Boston is not just the site of some of America's most iconic historical
moments, it is also one of the anchors of the Massachusetts
economy. The port is doing well, but unfortunately, the Boston industrial real
estate market is not quite reflecting the brisk business of the port.
The industrial market is at something of a crossroads. On the one hand, throughout
2006 and into 2007, the market has shown signs of growth, with rising abosrption
and rents. On the other hand, industrial activity in the Boston, indeed, in
the New England area, is in sharp decline, so the main tenants for industrial
property are disappearing. Additionally, the industrial space is only very slowly
being converted to more desirable uses such as light industrial, flex use and
residential or retail use. Although leasing activity is weak, purchase of industrial
property is up a bit, particular property in locations that lend themselves
to eventual residential or retail uses of the property. Experts expect to have
a clearer picture of the industrial market by the end of 2007.
The office market in Boston has been revitalized, and continues
to be driven, by small to mid-size leases. Such leases represent the majority
of transactions in the office sector and are helping to slowly absorb the available
office space. The absorption isn't yet reflected in rents, which are flat, as
supply still far outstrips demand. The high end office market is especially
hot in 2007, but this trend has been in the making for the last several years.
Investors are especially interested in Boston's prized properties. Of note is
the $889 million purchase of a one million square foot downtown office property
by the Fortis Property Group, an investor, not an occupant.
The retail market is also strong, particularly in South Boston,
which is undergoing rapid gentrification. South Boston is now home to a number
of upscale shops, resaurants and condominium developments. Vacancy rates are
particularly low in the area, and on the South Shore the vacancy rate is at
about 1%. Another two million square feet of development is expected to come
online in the next year, and experts predict it will be easily absorped. It's
not just South Boston that is hot; across the city, retail vacancies stand at
about 5%. Experts believe the Boston retail market is fundamentally sound and
that this is what is driving investor interest in it.