Photo by Steve Adams | Banker & Tradesman Staff

Two developers that compete for global icons such as Facebook and Google as tenants in Cambridge’s Kendall Square find themselves on the same side of the table for a change, with one poised to gain approval for an additional 800,000 square feet of office-lab space in the tech mecca. 

As Eversource seeks a site for a new substation to upgrade Cambridge’s electric grid, Boston Properties and Alexandria Real Estate Equities are offering a complex solution that reflects the lengths that developers will go to find new infill development avenues in East Cambridge. 

“Is this the most difficult project?” said Tom Evans, director of the Cambridge Redevelopment Authority (CRA) since 2013. “Maybe. The leadership came from the city to say we need to find a solution, and it got Alexandria and Boston Properties to work together.” 

A Thousand Parking Spaces 

Boston Properties’ 1.7-acre Blue Garage property at 290 Binney St. is the key to unlocking additional development in a submarket where lab rents hover around $100 per square foot and vacancies rarely exceed 2 percent. 

Under a rezoning proposal by the CRA, Boston Properties would demolish the 6-story garage, providing a blank slate for the new development plan. A third of the property would be sold to Eversource for the substation. Two new, 400,000-square-foot office-lab buildings would be built on other portions of the site. And two residential buildings totaling 425 units previously approved for above the garage would be replaced by a single 500-unit apartment tower. 

Alexandria would provide temporary parking at its nearby properties during the Blue Garage demolition and reconstruction. 

“We have 1,100 parking stalls above ground. If it weren’t for Alexandria helping us finding a solution for those parkers in what could be a two- or three-year construction window, we wouldn’t be able to have this conversation,” said Michael Tilford, a senior project manager at Boston Properties, in a virtual community presentation last month. “So other developers had to participate, specifically Alexandria.” 

Potential rezoning of Boston Properties’ Blue Garage property, originally slated for a pair of residential towers, could add up to 800,000 square feet of new office and lab space in pricey Kendall Square. Image courtesy of Sasaki Assoc.

To offset the costs, which Boston Properties estimates at up to $200 million, the developer would get approval for two 400,000-square-foot commercial buildings on the garage site. 

But critics say developers would be rewarded for a problem of their own making, gaining additional density after contributing to the energy usage by building millions of square feet of office and lab towers in recent years. Alexandria, Boston Properties, MIT Investment Management Co. and BioMed Realty all have robust development pipelines in the neighborhood, including MIT’s redevelopment of the Volpe Center with 1.7 million square feet of commercial space and 1,400 housing units. 

“Privatize the gains and socialize the losses: that’s what these guys do over and over,” said Heather Hoffman, a member of the East Cambridge Planning Group community organization. “All of the developers should be contributing to the problem that they caused. 

Plan B for Substation Site 

Eversource originally sought to build the substation at 135 Fulkerson St., a property it acquired in January 2017 for $12.9 million. 

The substation will reduce the risk of power outages by adding redundancies and flexibility in Cambridge’s electric grid, while meeting growing electric demand, according to an Eversource presentation made to a community meeting in May 2019. 

We need to meet the growing demand for electricity, but the solution we are working on with the city, our private developer partners and the community will also help strengthen the reliability of the entire system,” Eversource spokesman Reid Lamberty said in a statement last week. “A more resilient transmission grid allows delivery of power from remote clean energy resources and a more flexible distribution system enables that energy to be efficiently delivered where and when needed.” 

After a public outcry against the location next to an elementary school and residential neighborhood, City Manager Louis DePasquale reached out to developers about alternative locations. The Blue Garage property  currently approved for two multifamily buildings totaling 425 units  emerged as the frontrunner. 

Officials: Housing a Must 

The site is part of the CRA’s MXD, or mixed-use, district which is approved for 4.3 million square feet of development. Commercial projects include the new 468,000-square-foot Akamai Technologies headquarters at 145 Broadway and Google’s 362,000-square-foot office building under construction at 325 Main St. While developers often opt to build office and lab space because of their high rents, city officials thought it was important to require a substantial multifamily component in the MXD District. 

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“The delivery of the housing is a major goal of the CRA to get the affordable housing component that is part of it, but also to diversify land uses and activate the neighborhood more with that presence,” CRA’s Evans said. “We’ve been working for a while to make Kendall Square more of an 18-hour neighborhood rather than an office park.” 

As for the Eversource site on Fulkerson Street, the CRA proposal calls for the utility to sell the parcel to Alexandria Real Estate, which would in turn transfer it to city ownership for potential uses such as open space and housing. Alexandria has pitched that idea as a benefit as it seeks to rezone the former Metropolitan Pipe Co. property on Binney Street for additional density in a future development, Evans said. 

The rezoning requires a two-thirds vote by the Cambridge City Council. The CRA is sponsoring the petition in its role as administrator of the Kendall Square urban renewal area dating back to 1965. Changes to the urban renewal plan also require approval by the state Department of Housing and Community Development. 

“The City Council will have to weigh the merits of the development and specifically the alternative substation site, which we think is one of the major public benefits of this,” Evans said. “The biotech community in Kendall Square has a very important role in the world, and so allowing the lab space to grow also probably has merits that are hard to measure right now.” 

Rivals Look to Unlock Kendall Infill

by Steve Adams time to read: 4 min