Massachusetts is poised to attain a new position in the U.S. Senate, one it hasn’t held for a long time, if ever – the position of senatorial powerlessness.

Now that news has spread of U.S. Sen. John Kerry, D-Mass.’s potential departure for greener pastures as President Barack Obama’s Secretary of Defense, the commonwealth could have yet another special election for yet another new U.S. senator.

When progressive Democratic powerhouse Sen. Edward Kennedy died in 2009, Republican Scott Brown was elected as the state’s newest, and most junior, senator. Now Democrat Elizabeth Warren has taken that title. If Kerry’s star rises, then Massachusetts’s senatorial delegation would be hard-pressed to exert much, if any, influence in Congress.  

“We’ve been losing our clout,” said David Begelfer, CEO of NAIOP, a lobbying group for commercial property owners and developers in Massachusetts. “If John Kerry moves into Obama’s cabinet, that opens up the Senate seat, and whoever gets in there will be the most junior senator in the whole Senate. Then we’ll have two junior senators relative to other states. Obviously losing Ted Kennedy was the biggest loss.”

That’s a daunting thought since there could be a shakeup in federal research funding for life sciences companies and research institutions after the budget crisis, known as the “fiscal cliff,” is figured out. And with potentially little bargaining power available, that could spell fewer federal dollars coming to the state, which on average receives $200 million to $300 million from the National Institutes of Health alone.

More than anything else, that could be the greatest effect from the recent elections on commercial real estate in Massachusetts. But at the bottom of the cliff are also the Bush-era tax cuts that will expire, taking $500 billion from businesses’ and consumers’ checkbooks if Congress doesn’t agree to $1.2 trillion in savings to reduce the federal deficit by Dec. 31. Then, simultaneously, budget cuts would also take hold, chopping another $400 billion from the country’s economy.   

“Something’s going to give on taxes, and even greater taxes are looming,” said Ted Tye, managing partner for Newton’s National Development. “Until it all gets settled out in Congress, it seems we’ll all be living with this uncertainty. Uncertainty is never a good thing because it slows down decision makers from making those business decisions that drive growth.”

But we do have a stronger economy and some better employment numbers in Massachusetts now than in the recent past, Tye added. Construction is under way now on many mixed-use projects in the state that were shelved before the recession. But there’s not a lot of it, and not a lot of new construction projects getting out of the ground. In general, the Greater Boston market is stable to flat, and will likely remain that way through next year, Tye told Banker & Tradesman.

“There won’t be incredible growth, but hopefully there won’t be a precipitous drop either,” he opined. “But we live in fearful times.”

Signs Of Life

But new projects are getting under way, albeit in the planning stages, said Kenneth Goldberg, real estate attorney with Bernkopf Goodman in Boston. He said lenders are now focusing on new projects from trusted and experienced developers. That’s new in the last six months, Goldberg said. Before then, lenders were more inclined to refinance but not provide new development financing, he offered.

“Experienced sponsors have access to capital and financing to make things happen,” Goldberg explained. “We’re seeing now the beginning of planned, more steady growth rather than explosive spurts of growth that have led to prior boom/bust experiences. We’re coming through the European crisis, and finally it’s over – the election. People now realize there need to be some changes. There are systemic problems that need to be addressed. But businesses now have more broad-based feelings of sufficient positive direction in the economy to warrant considering growth.”

Woburn’s Tocci Building Corp. is one firm hoping companies decide to grow their businesses, because that can translate into construction work for the firm, which works primarily in suburban Greater Boston markets. Recently, new construction of office buildings has been mostly in Boston and Cambridge.

Bud LaRosa, Tocci’s chief business performance officer, said he hopes rising rental rates and tightening of space in the downtown markets will spill over into new construction in the ’burbs.

But what hasn’t been lacking in the suburban markets has been the push for medical office buildings (MOB). LaRosa sees MOBs as the rising star asset class in the coming year for the suburbs, especially as healthcare providers try bringing services to patients instead of patients traveling to those services.

Email: jcronin@thewarrengroup.com