VBJ Article Provides Commercial Real Estate Update for Clark County

The Vancouver Business Journal ran a story Friday exploring the present state of the commercial real estate market in Clark County. The article suggested that lease rates are decreasing and vacancy is going up, but that there are some positives. For instance, retail vacancy has increased, but it could have gone up quite a bit more. NAI NBS' Pam Lindloff, a retail specialist, and Garret Harper, who focuses on industrial leasing and sales, were interviewed for the article. You can find it here.

NAI NBS tracks vacancy and construction in Clark County for office, retail, industrial and multifamily properties. Our Second Quarter 2009 reports will be posted on this blog and on our Web site by mid-July.

Building Ownership Isn't Always the Best Option

Flexibility and professional property management are among advantages for tenants in business parks

Ken Boyko, Vice President, NAI NBS

Firms seeking industrial space have many options, and one is to buy a building. But tight budgets and financing difficulties may prevent companies from owning their own space.

One viable alternative for companies is to lease space in a business park. Spaces in business parks can suit firms of any size, and they come with some major advantages.

In general, leasing space can be more financially advantageous than owning. One major benefit is less required capital investment, since a tenant’s only significant investment in the property is generally a security deposit. The tenant also has less debt service, which frees up capital to invest in other aspects of the business, such as personnel, equipment or inventories.

Tenants also don’t need to be concerned about transaction costs or risk in a changing market. Some companies that purchased facilities when the market was good would like to sell them now, but selling a building in today’s economic environment can be a real challenge; it also comes with added costs.

Business parks have some additional benefits. One is the flexibility to expand and contract, often without many complications. If tenants are doing well and wish to add space, landlords often will let them to do so. Landlords also may allow tenants that are downsizing to reduce their square footage. This flexibility can take away the stress and costs of having to relocate and sign a completely new lease.

Bigger landlords with national reach, like ProLogis and Opus, often own a number of business parks. This can make it more convenient for tenants desiring to move. A tenant seeking to move to a different business park in the same city may be able to rent from the same landlord. And if a tenant wants to open up a facility in a different city where the landlord has properties, the firm has a contact for space in the market it is moving into.

Another perk of business parks is professional property management. Property managers take care of many of the day-to-day needs of commercial space, including maintenance, landscaping, and cleaning. A property manager is a major asset in a business park because the manager handles many aspects of the facility that would otherwise require time and energy that a tenant may not possess.

Business parks also realize economies of scale. Business parks come in many different sizes, but, in general, the greater the square footage in a facility, the less expensive it is to maintain. That can mean lower rates for tenants. Also, many business parks were built in the past 25 to 50 years, so they are up-to-date and include modern elements such as green features.

A diverse mix of tenants is drawn to business parks. Tenants with complementary businesses may gravitate toward similar types of space, allowing them to do business with each other. Tenants of business parks can make connections and develop relationships with other businesses all under the same roof.

Portland is fortunate to have many attractive business parks located in all corners of the metro area, so local industrial tenants have a wide variety of choices. The Portland metro area has nearly 7 million square feet of industrial space in business parks, according to NAI Norris, Beggs & Simpson’s First Quarter 2009 market report, and a significant portion of the 11 million square feet of flex space in Portland that NAI NBS tracks is also in business parks.

One example of a successful local business park is Parkside Business Center, which is managed by RREEF and leased by NAI Norris, Beggs & Simpson. Built in 1981, Parkside has about 630,000 square feet of flex space on 52 acres. It’s in a convenient Beaverton location, just off of Highway 217 between Interstate 5 and Highway 26, near Washington Square. Many types of tenants have found Parkside Business Center to their liking.

Some businesses do need their own buildings; heavy manufacturing firms, for instance, do not lend themselves as well to business parks. But for many companies, a business park is an attractive and affordable choice to call home.

Honzel Joins NAI NBS Retail Team

NAI Norris, Beggs & Simpson has added Real Estate Broker Tyler Honzel to its retail brokerage team.

Before joining NAI NBS, Tyler specialized in investments at CB Richard Ellis in Portland. Prior to that, he was a Major Accounts Manager at Verizon Wireless, where he maintained existing accounts and generated new business.

Tyler has also worked in inventory at Nordstrom and JC Penney, ordering product for both companies’ catalogs and working on Internet ordering. In this capacity he gained a comprehensive understanding of the inner workings of the retail industry.

Tyler holds a degree in business marketing from the University of Portland. He is a licensed real estate broker in Oregon.

With the addition of Tyler, NAI NBS' retail team has five members who cover all of the Portland metropolitan area, including two brokers who specialize in retail in Vancouver and Clark County. For more information on Tyler and the rest of our team, visit our Web site's retail page.

Qualman Featured in Article on Vancouver's Proposed Padden Parkway Business Park

NAI Norris, Beggs & Simpson Executive Vice President Roger Qualman, who runs the Vancouver office, was featured today in a Columbian article about Padden Parkway Business Park, a 276,000 sf proposed business park in Vancouver, on the southwest corner of St. Johns Road and Northeast 78th Street. The property's developer is having trouble attaining financing, so he is asking potential tenants to secure low-risk loans through the federal Small Business Administration and buy their own buildings. The business park would serve office, retail and light industrial tenants. You can find the article here.

NAI NBS Ranks Second on PBJ's Top 25 Commercial Property Management Firms List

NAI Norris, Beggs & Simpson ranked second on the Portland Business Journal's list of the Top 25 Commercial Property Management Firms, based on total metro square footage managed. The list was published in the Friday, June 5, edition. NAI NBS' 15 property managers in the Portland metropolitan area manage 7,125,814 square feet of commercial space, including office, industrial, flex, retail, and land.

Oregon, Washington May Lead Nation Out Of Recession, Moody's Predicts

Oregon and Washington are two of the states that will lead the nation out of the recession, according to Moody's Economy.com. The others are fellow western states Idaho, Colorado and Texas.

Moody's said that job growth in these five states should start to rebound first, likely in the fourth quarter of this year.

The large number of high-tech companies in Oregon and Washington will benefit when tech spending picks up again, Moody's predicted, and home sales in these states will be stimulated by lower prices and good mortgage rates.

You can find The Oregonian's coverage here.