Cambridge seeks to boost office space for startups

Mass Innovations, From The Beacon, September 2013

A city that pioneered a mechanism for generating affordable housing units 15 years ago is working on a similar ordinance designed to promote the creation of low-priced office space for entrepreneurs and startups.

Cambridge already has established an agreement with MIT requiring that 10 percent of the university’s new commercial development be devoted to individuals or very small companies. The City Council is now crafting a similar policy for the Kendall Square business district adjacent to MIT.

While measures requiring developers to set aside affordable units in new residential developments are now common, Cambridge’s plan for office space in Kendall Square is believed to be first of its kind in the nation, according to City Councillor Leland Cheung.

Cheung said the city’s inclusionary zoning ordinance, enacted in 1998 to require residential developers to set aside a certain number of affordable units, helped inspire the proposed policy for commercial development in Kendall Square.

“One of the challenges we were seeing was that a lot of entrepreneurial companies were unable to find small startup space,” said Cheung, a councillor since 2010. “At the same time we were seeing companies like Microsoft moving in, which was very exciting. But they were buying up entire buildings, leaving not enough space for entrepreneurs to get started.”

Space needs for individual entrepreneurs tend to be minimal – perhaps a single small office or even just a desk in a common area. Cheung said that because of the modest needs of entrepreneurs or very small startups, MIT agreed to a minimum of 10 percent of its new office space being set aside for such purposes. There is also an incentive for MIT to make 20 percent of its new commercial development available for entrepreneurship: At that threshold, developers are less constrained by density restrictions.

“We want to maintain the entrepreneurial ecosystem, and make sure that we build enough space so that startups can grow into small companies, and eventually become big companies, that contribute back to the economy and create jobs in the city,” Cheung said. “Creating companies here, and then helping them to grow, makes them much more connected to the local economy than other companies that are brought in from elsewhere.”

He added that not every company succeeds, and that’s to be expected, but the city wants to provide the opportunity.

For more information, contact Leland Cheung at (617) 349-4280.