“I don't want to say it's recession- proof. But it's not making luxury yachts. Hospitals still need to function and people still get sick,” Clancy says. “There's a big, aging demographic going on out there.” That's why the sector holds up better than others, Clancy says.

Rising revenues

Following BD Medical's acquisition of Beaver Surgical in 1989, the company grew from a 100,000 sq. ft. facility in Waltham, Mass. to 135,000 sq. ft., says Doug Lawrence, general manager and vice president of the ophthalmic division. He is also chairman of MassMedic.

“Most of our products are used in cataract surgery. In about 30 minutes a patient can have the cloudy lens in his or her eye removed and replaced by a plastic implantable lens,” he says.

Based in New Jersey, BD Medical is one of the largest device companies in the world, with 2007 revenues of $24 billion. Ophthalmic revenues generated by the Waltham facility and one in the U.K. rose from $69 million in 2007 to an estimated $79 million in 2008.

The device sector uses both office and industrial properties for administrative, research and manufacturing, and adaptable flex space. New York-based research firm Reis reports that office vacancy rates in the metro area rose from 11.4% in the third quarter of 2007 to 11.8% in the third quarter of 2008. Effective rents increased from $30.65 per sq. ft. to $34.32 in the third quarter.

The industrial vacancy rate was higher than office vacancies at 13.6% in the third quarter, but that was an improvement over the same period last year when the vacancy rate stood at 15.1%.

The sector is distinct from bio-tech, human gene research or other life sciences industries, although many people lump them together. “Smith & Nephew is not a biotech company. Boston Scientific is not a biotech company,” Clancy says. “A lot of it is machining. It's just not that sexy.” Given the achievement of the device companies, he expects even greater strides. “I've tried to tell people about it.”
Denise Kalette is senior associate editor.

BOSTON - BY THE NUMBERS

LARGEST PRIVATE EMPLOYERS

1. Massachusetts General Hospital
   21,457 employees

2. Harvard University
   19,292 employees

3. Brigham & Women's Hospital
   13,839 employees

Source: BRA

CITY POPULATION

4.1 million

Source: Boston Redevelopment Authority (BRA)

UNEMPLOYMENT RATE:

5.1%

Source: BRA, Mass. Executive Office of Labor and Workforce Development