Cambridge councillors probe lab and office vacancies ahead of budget season

CAMBRIDGE -- February 15, 2024, Cambridge councillors warned of growing commercial vacancies and budget risk as lab and office markets soften. The Economic Development and University Relations Committee, chaired by Councillor Paul Toner, heard Thursday from city assessor Gail Willett, Assistant City Manager Aram Sabagh, and leaders of the Kendall Square Association, Harvard Square Business Association, and Cambridge Chamber of Commerce. Willett disclosed that Cambridge received just 51 commercial abatement filings from 1,527 taxable parcels, a 3.3 percent ratio, the lowest in five years, and noted that the city's commercial tax rate of $10.46 per thousand compares favorably to Boston's $24.68. The January 26 transfer of roughly 10 acres of the Volpe site to MIT for $750 million was cited as a source of new taxable development revenue for the next five to ten years. Kendall Square Association director Beth O'Neal Maloney warned that Kendall Square accounts for roughly one-third of Cambridge's property tax revenue and faces rising competition from neighboring communities, noting that Somerville and Watertown are now actively recruiting life science tenants. Harvard Square Business Association director Denise Jilson reported a current storefront vacancy rate of 7 percent, within the square's historical range, but blamed persistent foot-traffic losses on the decade-plus closure of the Harvard Square Theater.