Lincoln Property Company | 53 State Street, Boston, MA | 617.951.4100 | LPCBoston.com

FEW LARGE BLOCKS Only 2 options above 400K

STRONG LARGE USER DEMAND Multiple 500K+ requirements

DECREASING INVENTORY

Conversion to multifamily and retail

LAST MILE LOCATIONS

Rents approaching $25 NNN

COMPLEX DISTRIBUTION

PROCESSES Multiple warehouse property types

FIRST QUARTER 2018

INDUSTRIAL MARKET TRENDS

495

495

495

128

Greater Boston’s Industrial market has shown tremendous growth during the past 24-36 months, vacancy is near record lows and rents are exceeding previous highwater marks. A significant portion of the demand surge stems from the Boston’s steadily growing population base which has increased 9% over the past 7 years. The combination of increased population density and today’s “on demand” delivery environment has pushed the industrial envelope.

The lack of viable development sites, particularly for 500,000 SF or larger facilities, has generated tremendous competition for modern high-bay warehouse and as a result rents have jumped significantly. Well located, quality construction is commanding $7.00 NNN and on the sale cap rates have compressed to 6.0% for comparable product.

BOSTON

NORTH6.1% VACANCY$6.75/SF NNN

WEST3.0% VACANCY$6.82/SF NNN

SOUTH7.8% VACANCY$5.69/SF NNN

Submarket Inventory SF % Vacant % AvailableQuarterly Absorption

Annual Absorption

Asking Rate (NNN)

West 23,993,410 3.0% 7.8% 32,200 5,140 $6.82

North 48,465,390 6.1% 9.3% (1,182,870) (1,207,380) $6.75

South 45,615,090 7.8% 14.5% 191,580 (222,410) $5.69

Suburbs 118,073,890 6.1% 11.0% (959,090) (1,424,640) $6.23

Inner 10,036,850 5.4% 13.5% (187,230) (358,740) $11.10

Total 128,110,740 6.1% 11.2% (1,146,320) (1,783,390) $6.57

Lincoln Property Company | 53 State Street, Boston, MA | 617.951.4100 | LPCBoston.com

ADDRESS TOWN TENANT SF

66 Saratoga Devens SD Warren 262,000

90 Salem St Billerica FedEx 220,000

176 Grove Street Franklin XPO Logistics 170,000

150 Charles Colton Taunton Williams Sonoma 139,000

800 John Quincy Taunton EMS Warehouseing 111,700

380 S. Worcester Norton Spirit Logistics 90,000

14 Aegean Methuen Crown Holdings 85,000

NOTABLE LEASES

MARKET ACTIVITY RECENT SALES

$22,000,000 | $73.33/SF400 JOHN QUINCY ADAMS | TAUNTONBUYER: STOCKBRIDGE | SELLER: GENERAL DYNAMICS

$21,700,000 | $115.43/SFONE TECHNOLOGY | PEABODY

BUYER: AEW | SELLER: NORMANDY

$33,500,000 | $97.26/SFONE BEEMAN | NORTHBOROUGHBUYER: TH REAL ESTATE | SELLER: STOCKBRIDGE

$12,00,000 | $100.84/SF301 PAGE STREET | STOUGHTON

BUYER: CONFIDENTIAL | SELLER: CALARE

$16,500,000 | $101.23/SF20 CHERRY HILL DRIVE | DANVERS

BUYER: ABIOMED | SELLER: THIEBAULT

$8,000,000 | $120.81/SF180 NEW BOSTON | WOBURN

BUYER: METRO PIPE CO | SELLER: BRICKPOINT

ADDRESS TOWN TENANT SF

11 Cabot Blvd Mansfield Automation Solutions 67,000

485 Wildwood Ave Woburn AFR Furniture Rental 62,300

3 Industrial Way Wilmington Argix Logistics 55,700

50 Commerce Norton Nestle Water 41,300

301 Ballardvale Wilmington Monogram Foods 23,200

118 Lumber Lane Tewksbury Kenworth Northeast 16,500

Lincoln Property Company | 53 State Street, Boston, MA | 617.951.4100 | LPCBoston.com

THE SWISS ARMY SPACE

R&D, Office, Manufacturing & Storage

NEW ECONOMY TENANTS

Robotics, Biotech & Autonomous Vehicles

SUPPLY CONSTRAINTS

New flex not being built, warehouse conversions

PARKING COUNTS UPFlex space becoming more densely

occupied

RENTS ON THE RISEDouble digit is the new standard

FIRST QUARTER 2018

FLEX/R&D MARKET TRENDS

495

495

495

128

The Greater Boston flex market has become the home many of today’s most innovative tenants. The type of tenants that have been filling the flex market are shifting away from generic warehouse use and incorporating elements of office, R&D, manufacturing and product testing. Typically requiring 13’+ clear and large open floorplates these “new economy” tenants include market segments such as robotics, biotechs and autonomous vehicles.

Looking forward expect the market to maintain very tight vacancy rates and average rents will continue rising. Current market conditions are the result of strong demand and weak supply. As construction costs continue rising, the delivery of new flex space becomes increasingly challenging so watch for the conversion of older, lower clear height warehouse buildings into flex uses.

BOSTON

NORTH9.3% VACANCY$9.59/SF NNN

WEST8.6% VACANCY$12.06/SF NNN

SOUTH5.4% VACANCY$10.33/SF NNN

Submarket Inventory SF % Vacant % AvailableQuarterly Absorption

Annual Absorption

Asking Rate (NNN)

West 23,627,030 8.6% 15.7% (670,930) (442,530) $12.06

North 30,545,150 9.3% 14.9% (242,030) (102,190) $9.59

South 16,058,850 5.4% 8.4% 45,830 410,120 $10.33

Suburbs 70,231,040 8.2% 13.7% (867,130) (134,600) $10.57

Inner 1,826,000 4.7% 5.2% 2,200 (44,570) $14.34

Total 72,057,030 8.1% 13.5% (864,930) (179,170) $10.63

Lincoln Property Company | 53 State Street, Boston, MA | 617.951.4100 | LPCBoston.com

ADDRESS TOWN TENANT SF

The xChange Bedford iRobot 272,300

9 Forge Pkwy Franklin Tegra Medical 81,300

37 Upton Dr Wilmington Watson-Marlow Bredel Inc. 50,000

10 Elizabeth Chelmsford HTEC Sensor Solutions 33,750

400 Research Dr Wilmington Clear Motion 28,500

240 Eliot St Ashland Habitat for Humanity 25,000

20 Dan Rd Canton AmericanBio 23,400

NOTABLE LEASES

MARKET ACTIVITY RECENT SALES

$40,900,000 | $143.16/SFRIVERTECH | BILLERICA

BUYER: JUMBO CAPITAL | SELLER: KBS

$19,839,228 | $106.55/SF829 MIDDLESEX TURNPIKE | BILLERICA

BUYER: OSI BILLERICA HOLDINGS | SELLER: DIRECT INVEST

~$16,000,000 | ~$125.52/SF19 & 21 ALPHA ROAD | CHELMSFORD

BUYER: CONFIDENTIAL | SELLER: CALARE

$5,527,500 | $103.76/SF33 UPTON DRIVE | WILMINGTON

BUYER: STORAGE BUNKER | SELLER: RAM MANAGEMENT

$17,300,000 | $103.97/SF157 & 165 GROVE STREET | FRANKLIN

BUYER: TH REAL ESTATE | SELLER: HALLKEEN

$15,000,000 | $159.12/SF20 SEYON STREET | WATERTOWN

BUYER: SEYON GROUP | SELLER: CALARE

ADDRESS TOWN TENANT SF

40 Kenwood Cr Franklin Dale Medical Products 23,000

19 Alpha Rd Chelmsford VJ Electronix 20,000

107 Audubon Rd Wakefield Standex Engraving Group 17,500

140 Locke Dr Marlborough Signal Fire 15,000

72 Jefferson Marlborough Kwon's Martial Arts 5,100

72 Jefferson Marlborough Boston Scientific 4,000