Atlantic Tambone Corp., which developed the Methuen Industrial Center on a speculative basis in 2001, reportedly now is seeking a buyer for the fully leased building.
Hoping to take advantage of the hot investment climate for modern industrial buildings, Atlantic Tambone Corp. has placed 14 Aegean Drive in Methuen on the market for sale. Also known as the Methuen Industrial Center, the 234,000-square-foot building was developed on a speculative basis by Atlantic Tambone in 2001, putting it among the newest commercial properties north of Boston.
“It’s great space,” one source said of the asset, estimating that the building could trade for more than $18 million. The source also claimed that CBRE/Whittier Partners has been retained to peddle the property, listing the team as Gary Lemire, Philip Giunta, David Connolly, Mark Reardon and Bruce Grean. Reached Friday morning, Lemire referred calls to Atlantic Tambone, but principal Anthony A. Tambone did not respond to inquiries by Banker & Tradesman’s press deadline.
Despite the lack of official confirmation, sources insisted that 14 Aegean Drive is being offered to investors, with the action occurring a few months after Atlantic Tambone completed a lengthy lease-up program for the building. Two large deals this spring put the property at full occupancy, headlined by an 85,000-square-foot lease to Crown Cork & Seal, a Philadelphia-based company.
The developers also landed Mattress Giant for 63,000 square feet of space. Connolly and Grean handled the leasing duties for the landlord in the final phase, while Reardon was the agent in the Crown Cork & Seal transaction. Other tenants in the Methuen Industrial Center include Cytyk Corp. and Mygrant Glass Co.
Historically not considered investment-grade product, industrial buildings have become increasingly popular among certain buyers in recent years, garnering interest from pension funds and other institutional capital. Although users are often willing to acquire older, less efficient properties, sophisticated commercial real estate investors typically require such attributes as high ceilings, advanced fire suppression equipment and modern mechanical systems. Methuen Industrial Center meets all of those requirements, observers noted, and the 100 percent occupancy should be another bonus, according to the source tracking the sales effort.
“The stability is in place,” said the source, adding that aspect should be “a big draw,” albeit not for potential buyers who would want to occupy the building themselves. According to the source, investors are the most likely candidates to acquire 14 Aegean Drive, which should “go quickly” in the active real estate investment market.
Leasing Woes
Indeed, several prominent industrial buildings have already changed hands thus far in 2005, including another speculative project in Northborough. In that case, Invesco Realty Advisors of Texas paid more than $16 million for 55 Lyman St., a two-building, 260,000-square-foot industrial facility constructed by the Gutierrez Cos. of Burlington. Half of that space is leased to McKesson Medical Surgical Inc., which uses the space as its New England distribution center.
Other industrial buildings sold in the first half of 2005 included 445 Simarano Drive in Marlborough, purchased by Ram Management for $6.6 million, as well as 135 Constitution Blvd. in Franklin. In the latter deal, Invesco acquired the 227,000-square-foot distribution center for $15.5 million. Along with space users, which are concentrating on properties of 20,000 square feet or less, private opportunity funds with value-added strategies in play are now joining institutional capital seeking core assets to keep the industrial arena booming.
Despite the surge of capital seeking to invest in such properties, the Bay State’s industrial market has been in the doldrums on the leasing side for an extended period. Although certain regions such as the suburban south sector have fared relatively well, the northern suburban market has a midyear vacancy rate of 18 percent, according to figures compiled last week by Trammell Crow Co. The overall market of 43 million square feet for distribution and warehouse buildings has a vacancy of 17.3 percent.
As for Atlantic Tambone, the sale of the Methuen Industrial Center would end a five-year process that began with the groundbreaking of the hulking facility in 2000. Besides that structure, Anthony A. Tambone and President Robert F. Tambone have developed a variety of commercial properties over the years, including office, retail and warehouse space, as well as a recent movement toward self-storage facilities. Among Atlantic Tambone’s various real estate projects is the Dascomb Business Center in Andover, and Cedar Hill Industrial Center in Marlborough, a 120,000-square-foot, high-bay distribution canter. The company also constructed its headquarters building in Lynnfield, a pinkish, 103,000-square-foot office building located just off Route 128.
Joe Clements may be reached at jclements@thewarrengroup.com.
