A 243,000-square-foot lease by Philips North America will anchor the first commercial building at the 45-acre Cambridge Crossing development, with plans for more than 2,000 employees to occupy a new North American headquarters under construction on the Cambridge-Somerville border in 2020.
Developer DivcoWest broke ground last year on the first commercial building, a 425,000-square-foot office and lab complex at 250 North St., on speculation as life science and tech companies continue to generate demand in Cambridge and nearby submarkets.
DivcoWest is in discussions with additional tenants to fill the remaining space in the building, said Tom Sullivan, president of DivcoWest’s development division.
“We had been focusing our efforts on large tenants, who have the longer-term planning horizons anyway,” Sullivan said. “Given that we’re a couple of years away from completion, we’re in a position to entertain smaller requirements.”
DivcoWest acquired the property from Canyon-Johnson Urban Funds and HYM Investment Group in 2015 for $291 million. Three residential towers containing 2,500 units were previously built on the former rail yard property, more than 38 acres of which are located in Cambridge. Recently renamed from NorthPoint, Cambridge Crossing has approvals for 2.1 million square feet of office and lab space and an additional 2,400 residential units.
DivcoWest also is building 28,000 square feet of retail and restaurant space in the current phase – including 15,000 square feet at 250 North St. – as a lure for employers who want amenities within walking distance.
Sullivan said the decision to proceed with construction without an anchor tenant wasn’t difficult.
“It is a significant commitment but we had an enormous amount of confidence in the location and the quality of our plan, and the tenants seem to agree,” he said. “That’s been validated more quickly than we forecast.”
Rents for Cambridge office and lab space are 13 and 25 percent above all-time highs, according to recent research by JLL, as companies seek proximity to its life science cluster and research institutions.
Philips inked a five-year, $25-million research alliance with Massachusetts Institute of Technology in 2015 to collaborate on research of health care technology and energy-efficient lighting systems. The alliance prompted it to open its first Cambridge research center at 2 Canal Park. The Cambridge Crossing address will replace its Minuteman Road campus in Andover as North American headquarters, where approximately 2,200 employees are based.
At Cambridge Crossing, Philips will research areas including artificial intelligence, genomics and robotics.
