Oracle's complex to double in size
Project is latest in a series of expansions by tech giants
Oracle Corp., the world's third-largest software maker, is proceeding with plans to build a 150,000-square-foot facility at its Burlington office park, the latest in series of major real estate moves by out-of-state technology giants.
The new building will nearly double the size of Oracle's complex along Route 128, where the Redwood, Calif.-based company has been promising to expand for years. Construction is to begin by the end of September.
Oracle's plans follow real estate expansions by Google and Microsoft in Cambridge and IBM in Littleton, further evidence that Massachusetts remains an important outpost for the nation's big technology firms. Microsoft is also in the market for another 120,000 square feet, according to a re port from the real estate firm Cushman & Wakefield.
IBM is moving 3,400 employees to its 500,000-square-foot campus along Interstate 495, and several smaller firms - from online gaming guru Turbine Inc. to the data security firm Arbor Networks - are looking for significant chunks of space.
"The focus on IT is coming back," said Joyce Plotkin, president of the Massachusetts Technology Leadership Council. "Companies are coming here for brainpower and innovation. It's not just the life sciences; this is a prime area for IT space."
Oracle, whose growth has been slower than anticipated in Massachusetts, has completed an aggressive series of acquisitions in recent months, including the $8.5 billion purchase of software maker BEA Systems, its largest in three years.
So far this year, Oracle has gobbled up six companies. The software giant's new facility, which has already been permitted, marks the second phase of its planned expansion in Burlington.
In 1999, the company bought a former tennis club site overlooking Route 128 and constructed a 170,000-square-foot building. Executives then said they expected to build two more facilities within five years, but Oracle delayed those efforts as the company weighed its development options.
The state agreed to give Oracle a 5 percent tax credit on any investments it makes in Burlington, plus a 1 percent discount on its property taxes for any expansion, as part of a 15-year deal signed in 2001. At the time, the company said it planned to double in size to 2,000 employees in Massachusetts, but since then its workforce has failed to expand significantly. The firm now employs about 850 people in Cambridge and Burlington, according to the 2008 New England Technology Directory, published by Mass High Tech Magazine.
A spokeswoman for Oracle declined to comment on how many employees will be added as part of the new development.
Oracle's second building will be 25,000 square feet larger than initially planned. A third planned building has been scaled back a similar amount, to 100,000 square feet, said Mark Vaughan, an attorney with Riemer & Braunstein who was involved in the deal.
The company has not indicated when construction will begin on the third and final building, but Oracle representatives said plans for additional growth have not changed.
"We've all been reading a lot about companies scaling back lately, so it's encouraging to hear that a company is proceeding with an expansion," said Vaughan. "It also speaks to the attractiveness of the location."
Burlington has become a prime destination for companies looking to grow in Massachusetts, with dozens of firms relocating from Boston and Cambridge to large parcels in suburbia.
Framingham developer Patriot Partners plans to build a 2 million-square-foot life sciences campus in town that would incorporate 2,000 units of housing for senior citizens. Another major player, Nordblom Co., is pursuing efforts to build out Network Drive and Northwest Park, a pair of campuses with more than 2 million square feet of office space.
"The Route 128 belt is still getting a significant amount of growing technology companies," said Mark Roth, an executive director in suburban brokerage for Cushman & Wakefield. "Burlington has a great amenity base because of the retail and restaurants, and people can live in Southern New Hampshire and get there easily."
Burlington Town Administrator Robert Mercier said Oracle's expansion will generate another $500,000 in tax revenue for the town - money that's sorely needed amid the slumping economy.
"We've been a pro-growth community for a number of years. Our tax rate is pretty low," Mercier said. "We don't charge bus fees or athletics fees. These new buildings are carrying some pretty big freight."
Casey Ross can be reached at cross@globe.com. 