It’s a city with deserted factories, devalued property, and a bad image. It’s also got the fastest Internet connection possible, first-class office space at low prices and ocean views.
What’s happening in Lynn? Out of the ashes of the former manufacturing, General Electric-dependent town is rising a brand new, high-tech concept of the “City of Sin.”
That new concept centers around Lynn’s so-called Cyber District, a cluster of telecommunications companies located in newly renovated industrial and retail space in the heart of the downtown area. Two major arteries are pumping new life into the area: a transatlantic fiberoptic cable system and a major north-south fiberoptic cable system running from Boston to Miami.
The firm 360 Networks, formerly Worldwide Fiber, chose Lynn to be the hub of its $650 million transatlantic cable connecting to Dublin, Ireland and Halifax, Nova Scotia. The cable, set to be up and running this spring, is the first of its kind in New England.
Meanwhile, Asset Channels of Connecticut will soon start construction on its $300 million north-south cable.
Every building along the way has the capability of hooking in – and cashing in – on the 1.28 terabits (12 million phone calls)-per-second cable.
“Buildings that were abandoned all of a sudden have a new value associated with them,” said Stephen Harausz, Lynn’s director of development and president of its Economic Development and Industrial Corp.
The fact that the cable runs practically under the doorstep of Shore.net, the second-largest Internet service provider in the region, prompted that company’s recent $43 million sale to become a division of iPRIMUS. The deal immediately created 200 new jobs in the city, Harausz said.
Shore.net was the original impetus behind the Cyber District concept when company founder Lowell Gray opened in Lynn 10 years ago on a $25,000 small business loan from the city. Other Internet-related businesses later followed, clustering around Shore.net as their Internet service provider.
The city is beginning to define the district as a place where the city, technology companies and property owners join to nurture the downtown technology sector. Businesses that have located in Lynn include Web designers, network engineers and Internet service providers interested in the low cost, high speed and security of data transmission powered by a company and cable located so close to their own businesses.
Verizon is another key player in the Cyber District, with its switching facilities located conveniently in the downtown area.
In 1998, Oasis Development Enterprises bought three square blocks of the downtown area and, after several false starts, finally came up with the concept of converting the old buildings into fully wired facilities. Phase one of that major high-tech commercial development, called the Gold Block project, was completed in August, creating roughly 13,000 square feet of high-tech office space with an additional 60,000 planned.
“We just leased 10,000 square feet to SAGA Information Systems, out of Pittsburgh, Pa., of all places. It’s their first Boston office,” said Phillip K. Burgess of Burgess Properties, which is handling the Gold Block project as well as the Clocktower building redevelopment.
EDIC Executive Director Peter DeVeau called the Clocktower project, formerly the Norelco building, the “hallmark project” of the city, while Burgess noted that it is currently the only building in the world fiber-optically connected.
“It’s wonderful. There’s been great development here,” said Burgess. Traditionally, the commercial real estate market has consisted of local law firms, accounting firms and human service agencies. The announcement of the transatlantic cable last year “stirred the pot” of the local market, he said.
The renovated Clocktower building is about 80 percent full of tenants, Harausz said, including Lightbridge and Patriot Properties, and has spawned hundreds of new jobs.
Another previously undesirable office building recently sold to Eastern Bank for $11.5 million, creating another 300 new jobs.
‘Many Uncertainties’
The city is also making progress on the brownfields redevelopment of the former Empire Laundry. Five single-family homes, compatible with the surrounding neighborhood and geared toward first-time homebuyers, will be built on the site. The first house will be built this spring.
“With brownfields there are so many uncertainties. There are a lot of surprises throughout the development process,” said DeVeau. He credited the city’s relationship with the Housing Authority, and his housing director’s relationship with the neighborhood, for the unique project.
Most of that activity has taken place in the last six months, said Harausz, a welcome turn of events given the city’s history.
“The Massachusetts miracle just sort of skipped over Lynn,” Harausz said.
Between 1988 and 1998, the city lost 9,000 jobs, about 23 percent of its workforce. More than 400 businesses left the area. Per capita income was 25 to 35 percent below the national average. Lynn lost $100 million in assessed value, a reflection of the “white middle-class flight” from the city, Harausz said.
Meanwhile, in 1998 commercial tax rates were the highest in the state at $40.50.
“What we had was a combination of business flight, residential flight, loss of value and a rising tax rate, which all accelerated the demise of the city,” Harausz said.
With a lower commercial tax rate ($36.17) and new activity, the city has started to sell itself aggressively, marketing the fact that Logan Airport and the MBTA are only 10 minutes away and that first-class office space is selling for $15 to 18 per square foot as opposed to Boston’s typical $80 to $100 per square foot price.
“Two years from now, I think we’ll see a totally different city than we have now. The changes are going to be exponential,” Harausz said. “We get calls daily from companies asking what’s going on. You can see a light at the end of the tunnel.”
The city’s strategy now is to capitalize – cautiously – on technology and on changes as they occur.
“Do we have problems? Yes, but we’re addressing them,” said Harausz. “Yes, we have an opportunity here, but let’s learn from the past and the mistakes of the past. Certainly we’ll jump on this thing right now. But we can’t rest on our laurels. We have to continue to keep pace.”
