A Burlington developer has gotten the seemingly impossible in this down economy: a deal to build a corporate headquarters as soon as possible.
Nordblom Co. next month expects to begin building a 130,000-square-foot home for Palomar Medical Technologies Inc., a producer of cosmetic lasers that wants to move its operations to Nordblom's Northwest Park in Burlington.
Though not huge in terms of size or money, the Palomar project is significant at a time when tight credit markets are causing numerous high-profile commercial developments across the region to delay construction.
This will be the first building for Nordblom at Northwest Park since the company expanded its holdings there last year with the $212 million purchase of adjacent land owned by Sun Microsystems on Network Drive.
With its combined properties now at 285 acres, Nordblom plans to build a self-contained community between Route 3 and the Middlesex Turnpike: 3.5 million square feet of office space, 300 multifamily residences, 225 hotel rooms, and 600,000 square feet of stores and restaurants.
"We want to create something different, something that has the feel of a city," said Todd Fremont-Smith, a senior vice president at Nordblom. "Even in an unsteady market, we are making progress."
Governor Deval Patrick's administration last week designated the park as one of 16 growth districts across the state. That allows for expedited permitting, helps Nordblom and the Town of Burlington obtain state funds for roads and other infrastructure, and gets the company additional marketing of the location to tenants looking to expand in Massachusetts.
Palomar has agreed to pay $10.7 million for 8.3 acres. The company, which is moving from a facility on Cambridge Street in Burlington, will finance the construction of its new headquarters, estimated to cost $25 million. Palomar also has an option with Nordblom for a 50,000-square-foot expansion.
"Our current premises are inadequate to continue the company's business," said Dan Valente, executive chairman of Palomar, a publicly traded company that makes lasers used in hair removal and other procedures. "This is a perfect location for our employees. With all the amenities, it will be a nice place to be."
The deal follows a move this fall by the software maker Exa Corp. to lease 66,000 square feet in the development.
Real estate professionals said the Palomar building is evidence that even in the weakening economy, some companies are expanding. Suburban locations are proving especially attractive because of quicker permitting and less expensive leasing costs. Burlington, Waltham, and Lexington have experienced rapid growth in recent years as technology and medical firms have moved farther out in search of new space.
"This deal proves that not everything is down right now," said David Begelfer, chief executive of the Massachusetts chapter of the National Association of Industrial and Office Properties. "There are still opportunities out there that make sense."
Still, Nordblom's progress has been delayed by the worsening economy. Executives at the company said many prospective tenants have shown some interest in its site during the past year. But as companies wrestle with their finances, it is becoming more difficult for Nordblom to turn that initial interest into a firm commitment.
Fremont-Smith said Nordblom is taking a steady approach to building out the park over the next 15 years, hoping an eventual upswing in the economy will fuel a burst of construction activity.
"These are bumpy times we're in right now," he said. "But projects have to be planned on a much longer horizon than the next 12 months."
Company representatives are aggressively pushing the site as a hassle-free environment for companies to expand. The zoning plan for the park has already been approved, allowing Nordblom to proceed quickly with construction after companies agree to buy space, executives said.
The Patrick administration's move to designate the park as a growth district means it will be posted on a state website advertising the property as ready for development.
"Permitting can move at the speed of business, so companies do not have to wait 12 to 18 months to get the approvals in place," said Mark Vaughan, senior partner with the law firm Riemer & Braunstein, which handled permitting for the development.
Nordblom's plan involves gradual demolition and redevelopment of 30 to 40 buildings in the park. The company also wants to build a 1,200-foot road lined with retail stores, a public green, and a network of bicycle trails.
Casey Ross can be reached at email@example.com.