The Bulfinch Companies, Inc. is a third-generation commercial real estate investment firm with more than $2.5 billion in assets. Family-owned since its founding in 1936, the firm specializes in the acquisition, development, repositioning and management of properties across a variety of industries, with a focus on the Boston and Greater Boston markets.
The firm puts great value on sustainability and energy efficiency, and also emphasizes the delivery of environmental, social and economic benefits for communities and tenants alike. In doing so, the company has developed several notable projects of all property types, including some Boston office space of the highest standards.
Bulfinch owns and manages roughly 3 million square feet of office, biotech and medical spaces that benefit from 24/7 dedicated management. These properties are home to an impressive tenant roster, including high-caliber occupants such as Harvard University, Dana-Farber Cancer Institute and Warner Bros. What’s more, in the context of the ongoing pandemic, the forward-thinking company has also been providing critical support to its life science tenants that are conducting essential COVID-19 research.
Most recently, the company opened Building 400-500 — a state-of-the-art development that encompasses 286,000 square feet of LEED Gold-certified research and development (R&D) and office space in North Cambridge. This delivery marks the completion of Cambridge Discovery Park (CDP), an innovation hub that brings together 800,000 square feet of laboratory, office and R&D space spanning 27 acres of rich green space and located adjacent to the Alewife Brook Reservation. Although it just opened in the first quarter of this year, the property is almost fully leased, with approximately 32,000 square feet of prime Cambridge office space for rent remaining.
Expert Insights: Bulfinch on Nurturing CRE Success in 2020
We spoke with Mike Wilcox, senior vice president and director of leasing at The Bulfinch Companies. During our conversation, he shared valuable insights on the importance of adopting proptech in leasing and management; how the pandemic might change amenity offerings in commercial real estate going forward; as well as what the company has learned while successfully delivering new office space and managing a vast portfolio during the constantly changing economic environment of 2020 thus far:
Q: Your firm has decades of experience working on a wide variety of projects. What would you say stands out about the Boston office market?
Wilcox: “The Boston office market remains strong, thanks in part to our ‘meds and eds.’ As life science endeavors have continued to grow, Boston’s office market continues to expand, offering world-class opportunities for life science and biotech organizations. Cambridge, in particular, has drawn premiere pharmaceutical, life science and biotech companies from around the globe, creating an unparalleled cluster of sophisticated, cutting-edge researchers, including companies like Novartis and Pfizer, both Bulfinch tenants.”
Q: So far, 2020 has shaken up pretty much all sectors of our economy to varying extents. How has your experience been in commercial real estate activity in the past few months?
Wilcox: “Bulfinch completed construction at our Cambridge Discovery Park project amidst the pandemic, and we’re fortunate that our positioning of the property prior to the outbreak will provide key amenities to our tenants as they look forward beyond the current conditions. We anticipate health to be of utmost importance to tenants moving forward, and with this will come [as] requests that may reprioritize desired amenities and will change tenants’ needs.
“One such example is outdoor space, which has become increasingly important. The CDP campus is one of the largest campuses in Cambridge (behind MIT and Harvard), sprawled across 27 acres of lush, green space. Surrounded by Alewife Brook Reservation, the property includes coveted outdoor amenities, including walking trails, a soccer field and a volleyball court. All of this existed prior to the pandemic but, in recent months, Bulfinch has further activated the campus’ exterior, providing outdoor workplaces for our tenants. We anticipate that outdoor space will more frequently be offered at commercial real estate developments, as these spaces will provide greater flexibility and distancing opportunities for tenants and their employees.
“Amenities like food delivery service and on-site cafes and fitness centers were also of increasing importance to tenants prior to the pandemic, as they sought fully amenitized spaces. Though we cannot predict the pandemic’s long-term impact on amenities, currently, at our commercial properties, we anticipate changes in the way these services will be provided in the near-term (for example, individual food-ordering platforms instead of widespread catering, shifting café models, etc.)
“While office spaces will continue to incorporate tenant-specific design (such as lab versus office), we anticipate that shared amenities and spaces will see more drastic shifts.”
Q: Bulfinch opened a new state-of-the art office, lab and R&D facility at the start of the year (Building 400-500). Could you share some empirical wisdom on what challenges the firm encountered and what strategies and/or solutions have been most effective?
Wilcox: “Building 400-500 at Cambridge Discovery Park (CDP) was successfully 90% leased in [the] six months prior to the pandemic, leaving only the premiere office space on the sixth floor, at 32,253 square feet (in addition to 1,292 square feet of first-floor chemical storage), remaining.
“Bulfinch has significant experience building projects at impressive speeds — Building 400-500 took approximately 20 months from groundbreaking to completion and was delivered seven months ahead of the original schedule. This fast-track schedule has allowed us to secure tenants for our properties prior to completion, and we anticipate these short delivery timelines will be increasingly important as the lab and office landscapes continue to shift.”
Q: One hopes that this complicated year results in at least some notable progress. Are there any safety measures and policies that you think might or should be adopted into best practices for commercial real estate going forward, beyond this pandemic?
Wilcox: “The commercial real estate industry has certainly shifted in recent months. But, despite the extraordinary challenges faced during COVID-19, Bulfinch remains open and operational. There has been an increased enhancement of Bulfinch’s technology platforms, with our virtual leasing process allowing us to safely and effectively market available space and finalize transactions. We anticipate a continued use of technology to efficiently complete transactions, even in a post-pandemic world.
“As property manager at numerous buildings throughout Greater Boston, it has been critical for Bulfinch to devise protocols and procedures enabling properties to remain open, while also enhancing safety precautions. Bulfinch has implemented many operational changes at its properties, including increased sanitation of public spaces and incorporating protective glass partitions for reception desks. Moreover, Bulfinch has implemented on-site EMTs and screening procedures to further enhance safety at all properties.
“While some of these procedures and policies may be temporary, we’ll likely see building design adjustments, like plastic covers on elevator buttons; updated UV lighting with photo ionization in select areas; touchless technologies; and Merv 13 air filtration, where possible, continue to be implemented moving forward.”
Q: Bulfinch properties are home to an impressive tenant roster, including life sciences companies that are, without a doubt, currently hard at work. What tenant care and assistance recommendations could you share, based on the company’s recent experience?
Wilcox: “Understanding and meeting the needs of our stakeholders, including tenants, lenders, investors and employees, has remained Bulfinch’s top priority. Throughout the pandemic, Bulfinch has strived to ‘Discover + Deliver’ innovative solutions for the evolving needs of stakeholders. We’ve found that remaining in close communications with tenants — and serving as a resource, when necessary — has been of utmost importance. We’ve had success disseminating important information to tenants through HqO, a tenant engagement application, and our team is at the forefront in planning and incorporating new technology and protocols to prepare our properties to safely accommodate the back-to-workplace transition.”
Q: Of the various capacities in which Bulfinch operates across the Boston area — acquisitions, development, repositioning, management — which has been less encumbered so far by setbacks and difficulties that may have naturally resulted from the COVID-19 situation?
Wilcox: “There was certainly a period of time where the pandemic was a shock to the commercial real estate industry, but at Bulfinch’s portfolio of properties, we have started to see companies reopen and employees coming back to the office, particularly at life science companies, many of which have remained open as essential businesses at this time.
“We’ve found that acquisition opportunities still exist in the market, and Bulfinch is well-positioned to take advantage of available opportunities. Our solid financial foundation, coupled with our entrepreneurial spirit, enables us to pursue quality acquisitions with our usual speed, efficiency and reliability.
“At present, we are considering various opportunities, including life science, residential, mixed-use, medical and office spaces.”