Taking advantage of plummeting real estate prices, Akamai will pay $15 million to break its lease near Kendall Square in Cambridge, Mass., and look for new headquarters.
The firm, which makes technology to speed delivery of Internet content, said it expects to announce the location of its new corporate offices within three months.
An Akamai spokesman did not immediately return a phone call seeking parameters for the office search. However, the company will reportedly stay in or nearby Cambridge.
“We intend to take advantage of today’s lower commercial lease rates to reduce operating expenses, possibly by as much as $8 million to $10 million annually
starting in 2003, without interrupting our operations or inconveniencing our employees,” Paul Sagan, Akamai’s president said in a statement.
The transaction includes two buildings (500 and 600 Technology Square) representing a total of 234,000 square feet. It releases Akamai from $110 million in
remaining lease commitments.
The Technology Square office complex consists of multiple buildings with a total of more than one million square feet. It is owned by MIT. Akamai expects to
complete a move to new headquarters this fall.
“The market for office space in the area has changed dramatically since the company moved to Technology Square in 1999,” said Akamai consultant Anne
Columbia, of the Columbia Group Realty Advisors.
Columbia said MIT should have little trouble finding new tenants for the space, which is in the heart of a bio-tech corridor that includes Biogen and Genzyme.
Akamai’s move comes three weeks after Internet consultant Viant paid $11.9 million to extricate itself from a lease in downtown Boston.