Federal Realty Investment Trust to build up to 1.1M sq. ft. mixed-use site on former IKEA parcel to serve 4,500 Partners employees

The state’s largest private employer, Partners HealthCare, will be the first major industry tenant to take up occupancy in Somerville’s new Assembly Row neighborhood. The nonprofit healthcare provider plans to build up to 1.1 million square feet of new mixed-use office space in several phases on the former IKEA parcel in Assembly Square. Approximately 4,500 administrative employees are scheduled to move by late 2016 into the first two buildings, which will follow Assembly Row’s active, urban streetscape design approach with retail on the ground floor and offices above.

“This is fantastic news for Somerville and the region. While Partners consolidates here to save on costs and achieve its goal of maintaining affordable healthcare, Somerville will be moving forward with exactly the type of smart, transit-oriented development and quality job growth that the community called for in our 20-year SomerVision Plan,” said Mayor Joseph A. Curtatone. “Such a renowned industry leader as our anchor tenant fuels our momentum as we work to attract new businesses and jobs to areas targeted for transformation in Somerville, including Union Square, Boynton Yards, InnerBelt and Brickbottom. So while Partners’ decision is certainly a milestone for Somerville, it also validates a long-range planning approach to the type of regional economic development that’s made possible by quality public transit.”

Partners, a tax exempt nonprofit, has agreed to make municipal services contributions to the city that are still being negotiated but will eventually total more than the tax payments IKEA would have made. Nonetheless, by consolidating 14 of their existing administrative offices in the Greater Boston area to the Somerville site, Partners estimates it will save $10 million annually while increasing efficiency. They have also committed to a project labor agreement for the construction of the site.

“I am thrilled that Partners HealthCare will be coming to Assembly Row. The entire area is already one of the most vibrant sections of the city, with new restaurants, retail outlets, residences and an MBTA stop all being developed. The addition of thousands of jobs will help boost Somerville’s overall economy and further stimulate development in Assembly Square,” said U.S. Representative Michael Capuano, who helped secure federal funding for critical infrastructure improvements in Assembly Square.

The first two Partners buildings on the site will be built in two phases by Federal Realty Investment Trust (FRIT), the developer of the 56-acre mixed-use, transit-oriented Assembly Row development currently under construction, which will include 1.75 million square feet of commercial space, 500,000 square feet of retail, a 12-screen AMC Theater, a Legoland Discovery Center,  a hotel and 2,100 residential units. Assembly Square appealed to Partners due to the Orange Line access created by the coming Assembly Square T-stop, the close proximity to Boston and the opportunity to build to their specifications. In addition to the initial 700,000 square feet of office space that Partners will own, 150,000 square feet of ground floor retail will be constructed and owned by FRIT.

“Assembly Square is a brilliant locational decision on the part of Partners HealthCare, for both its own employees and for broader long-term regional sustainability,” said Wig Zamore, a founding and active member of both the Mystic View Task Force and Somerville Transportation Equity Partnership. “The Assembly Square site will be next to the state’s first new T-stop in a generation, an Orange Line stop opening in the Summer of 2014 that will connect roughly 200,000 Orange Line riders, 650,000 other rail-based transit riders and 250,000 bus riders daily, which is exactly the point of transit-oriented development. So not only will there not be excess car traffic from this decision but due to the T-stop, the development transportation profile was able to remove 50,000 vehicle trips per day—the full number of new vehicle trips per day enabled by the $20 billion Big Dig project.”

Partners’ headquarters will remain in Boston and no clinical or hospital-based facilities will be affected. All staff moving to Somerville are in administrative support services. But long-range discussions include the possibility of some research and development space in the third phase of the build out.

“Partners’ 4,500 employees will add to Somerville’s daytime population, supporting the restaurants, shops, amenities and the services our local businesses offer, and that means not only greater tax revenue for Somerville but greater tax revenue for the Commonwealth. But this is just the beginning,” said Mayor Curtatone. “Our goal goes beyond creating the upper story tenancy that supports the shops and restaurants—we want to really highlight what Assembly Square and Somerville could be, which is an expansion of the research and development economy that is so important to this region and that is tied to the academic and research institutions nearby. This will shine a bright light on this opportunity and lead the way for many more.”