Boulder firms look east for savings

BOULDER — Orbotix Inc. chief executive Paul Berberian is like a lot of company leaders who are matter-of-fact about why they have located or moved their businesses to east Boulder:

“If it was the same price, I’d rather be downtown.”

With ample places for employees to walk to lunch, proximity to all kinds of startups and professional services, and the ambience of the Pearl Street Mall, downtown has plenty of advantages in drawing companies. But with better pricing and more space providing other opportunities, there has been no shortage lately of growing companies deciding that east Boulder can make a nice home as well.

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Orbotix, a tech startup with about 34 employees, is planning a Thanksgiving weekend move from 6,800 square feet at 1155 Canyon Blvd. to 16,374 square feet at 4772 Walnut St. in the Tierra Center Business Park. All of the extra elbow room will provide a nice shift from the company’s current space, where two to three people are in each office and there’s “lots of makeshift stuff,” Berberian said.

The new location “will be more purpose-built for our particular needs,´ said Berberian, who noted that the company is doing an extensive build-out at the new space. “So I’m really looking forward to it.”

According to third-quarter analysis of Boulder office submarkets conducted by real estate firm Newmark Grubb Knight Frank, downtown Boulder base rents range from $17 to $34 per square foot. The range is $12 to $20 for central Boulder and $8 to $14 for east Boulder, generally the area east of Foothills Parkway but not including Gunbarrel. That’s not taking into account that operating costs such as taxes, insurance and common area maintenance can add an additional $14 per square foot downtown versus roughly half that out east.

East has the inventory, too, with 19 percent vacancy in an area with a total of nearly 1.9 million total square feet of office space, according to the same set of statistics. Only 5.6 percent of the total 1.6 million square feet is available downtown – and for anyone looking for 10,000 square feet or more, there just aren’t a lot of options.

Both Berberian and Symplified Inc. chief executive Shayne Higdon said they evaluated large options downtown before deciding to move, but those options were mostly older buildings that required major refinishing on top of the already high downtown prices.

Dean Callan and Co. president Becky Gamble, whose company partners with Newmark Grubb Knight Frank on the leasing for Flatiron Park on the east side of 55th Street, admitted east Boulder doesn’t have the same cachet as downtown.

However, she added, “the more companies we see going out there and updating the tenant finish level, it’s going to slowly change the culture collectively in those east Boulder parks.”

The pricing downtown can be volatile. Broker Chad Henry of W.W. Reynolds Cos. — which owns Pearl East Business Park and Tierra Centre — said rates downtown just four or five years ago were 20 percent to 30 percent less than they are now that the economy is recovering from the recession. Companies that signed leases then and are looking to renew might be in for some sticker shock.

“It ebbs and flows,” Henry said. “It goes in cycles.”

Price and space might be the big factors in companies locating in east Boulder, but they certainly aren’t the only perks. Ample free parking is another. Symplified, which moved from 1600 Pearl St. to the Pearl East Business Park at 4900 Pearl East Circle in late October, was subsidizing parking for employees downtown, Higdon said.

Easing commutes for workers who often are coming to work from surrounding communities also makes east Boulder a draw, given traffic congestion in central and downtown Boulder during the day. TapInfluence Inc. co-founder and chief marketing officer Holly Hamann said her company’s decision to locate in Flatiron Park was a conscious choice about affordability and where the company could find a spot that could accommodate growth for a few years. But it’s also provided a source of convenience for an employee base that is primarily from outlying communities.

“From a commuting perspective,” Hamann said, “people can get in and out of east Boulder really fast.”

Landlords are trying to add to the lures of east Boulder with attractive pricing and perks. In 2011, Goff Capital Partners bought much of Flatiron Park, where many of the buildings were built in the late 1970s, ’80s and ’90s. Goff vice president Steve Eaton said his company has been working to upgrade lobbies and common areas in buildings and tries to have employee-friendly policies such as allowing dogs. The company also is working to bring in amenities. Upslope Brewing Co. located its new brewery and taproom in Flatiron Park last year, and Ozo Coffee Co. opened a retail location there this month.

“I think what we’re really trying to do is just upgrade the whole image of Flatiron Park,” Eaton said.

While startups, attorney groups and other professional services continue to flock to the smaller spaces and the vibe of downtown, companies that have put down eastern roots say some aspects of downtown working can be recreated. As companies grow, Berberian said, they develop their own cultures and don’t necessarily need the downtown atmosphere to maintain them.

Some east Boulder companies dedicate a portion of their savings on lease prices toward trying to offer added amenities for employees. Symplified has lunch delivered for employees two days per week, and TapInfluence does the same every Wednesday. CampMinder LLC founder and CEO Dan Konigsberg said his company offers a better health plan than it otherwise might be able to and is adding a 401(k) as it grows. Both CampMinder and TapInfluence also pay for periodic company outings, from renting boats on Horsetooth Reservoir to skeet shooting and brewery tours.

CampMinder, at 5766 Central Ave. in Flatiron Park, is on its second east Boulder location after having early roots near downtown Boulder. In its new spot, where it moved over the summer, the company was able to start with a gutted space and finance much of the tenant finish through its rent.

Many of the companies have gone with large collaborative spaces in the center with glass-walled offices and boardrooms around the outside geared toward individual meeting or quiet spaces, Konigsberg said.

“Why would you not want to have a built-out custom space for you.”