Zoll Medical Corp. (NSDQ:ZOLL) isn’t about to pay real estate bubble prices in a bear market, and that’s what’s driving the company’s hunt for new space, according to president Jonathan Rennert.
Rennert confirmed to MassDevice that the company is indeed in the hunt for new digs, saying that Zoll’s been exploring locations in New Hampshire, as reported earlier in the month by the Real Reporter, a newsletter that tracks commercial real estate moves in Massachusetts. The heart of the matter is a looming June, 2011, end date on the company’s current lease in Chelmsford, according to Rennert.
The resuscitation device maker currently leases space on a sub-lease from telecom equipment maker Tellabs, which originally signed a lease to expand into a Chelmsford office park in 2000. But it scrapped those plans amid the telecom crash in 2001. The hang-up right now is that Tellabs is still paying the rates it locked in during the boom days and is subsidizing the difference between that and the rate Zoll pays, according to Rennert. Zoll is at odds with the landlord, Boston Properties, over the current market value of the space. Zoll first moved into the facility in 2003.
Rennert said the company is looking for a minimum of 250,000 square feet, with an option to expand to 300,000 in the near future, as it continues to expand its operations through organic growth and small acquisitions. He said the pursuit of new digs has been going on in earnest for six months and that no option is off the table, including moving to New Hampshire or staying in its space.
“The fundamental point is that this is purely an economic decision,” Rennert told us. “We’re not going to be paying above current market value.”
Rennert said the company hopes to make a decision in the next couple months.