Despite numbers, commercial real estate on upswing
By Patrick Anderson PBN Staff Writer
Statistically, 2013 was an uninspiring year for Providence commercial real estate.
In the downtown office market, the vacancy rate rose as corporate moves left a net of 81,000 square feet of space newly unoccupied during the year, according to figures from CB Richard Ellis New England.
But sometimes numbers don’t tell the whole story and local real estate professionals remain optimistic that the market is heading, albeit slowly, in the right direction.
“It is such a small market that when you have a couple of building swings each way you can have a large change in the vacancy rate,” said Karl Hayes, partner at Providence brokerage Hayes and Sherry Commercial Real Estate. “One of the things that has happened this year is tenants committed to long-term leases and made commitments they weren’t making a few years ago.”
Many of those long-term renewal leases may not boost the current vacancy rate, especially if the firm slimmed down their footprint in the process, but they will create market stability and firm up demand further down the road.
CBRE Senior Vice President and partner Alden Anderson described a building level of interest in properties that bodes well for 2014 and beyond.
“I think a certain amount of this is more qualitative in nature than quantitative,” Anderson said. “When you are involved in any business venture, you just feel momentum, either with you or against you. In the market today, I feel there is a favorable momentum with regard to interest at the tenant, landlord and investor level.”
Some of the notable leases signed in 2013 included law firm Partridge Snow & Hahn moving into 30,000 square feet in the Textron Building on Westminster Street and retail analytics firm Swipely moving from Fox Point into 25,750 square feet at 10 Dorrance St.
But along with the new leases, some significant buildings remained empty throughout 2013.
One Empire Plaza, last occupied by 38 Studios LLC, remains dark with 104,000 square feet of unoccupied space. And just down the street, there are 59,000 square feet available in One Weybosset Hill, according to CBRE.