Construction of the shell of Vantage Point, a new waterfront building in the Keifer Park section of Quonset Business Park, wrapped up late last year. Developer-owner Riggs & Gallagher Inc. is ready to lease and build-to-suit for tenants, but President Douglas B. Riggs last week said that even the quickly growing Quonset Business Park isn’t immune to a slowdown in the commercial market.
So far, his company has been unable to reach any final agreements with potential tenants.
“Things have definitely slowed down a bit in this marketplace and we’re seeing the effects,” Riggs said. “We do have several companies that we feel that we’re very close with on final agreements, but it hasn’t officially happened.”
And that seems to be the situation in the Quonset park: commercial tenants and buyers are looking for property, but many of them are taking their time deciding, said Gerald E. Lavallee, senior vice president and partner with the Providence office of CB Richard Ellis-New England.
“The real estate market in general – because of the financing constraints and because of the unknown, relative to the general health of financial institutions – has caused people to slow their projects,” he said.
Lavallee added that he has a few signed letters of intent for new purchases or leases and General Dynamics’ Electric Boat recently leased 125,000 square feet in a Davisville building.
CBRE Senior Vice President and Partner Alden Anderson Jr. said Providence, where the vacancy rate hit 15.2 percent last year, is seeing a similar lack of activity. His firm is working to find tenants for the approximately 240,000 square feet that Blue Cross Blue Shield of Rhode Island will vacate later this year.
“I would say that there’s activity in the leasing market, as opposed to the sales market, which is a little bit quieter,” he said. “Clearly, nothing is immune to the macroeconomic issues that are facing the economy.”
Steven J. King, managing director of Quonset Development Corporation, last week said, “Obviously it’s a very difficult economic climate in the state and the nation. Quonset is not insulated from the problems in the economy. …
“However, in recent years there have been significant private investments in the park and we are positioned to take advantage of opportunities for further investments as the economy rebounds,” he said.
And the QDC reports that there’s no more land available in Keifer Park, which makes up 154 acres of the 3,047 acres of the former U.S. Navy base. And fewer than 200 acres are still available for development in all of Quonset Business Park.
As of January, the number of jobs in Quonset Business Park had grown to 8,800, a 7.3 percent increase from the 8,200 jobs reported in early 2008. In the last four years, 1,715 new jobs have been created.
About 300 of those jobs are in the Quonset Gateway development, a 72.5-acre, mixed-use project inside the western border of the park. That $100 million New Boston Fund Inc. project has attracted a Lowe’s Home Improvement, Kohl’s and a Dave’s Marketplace.
Just across the street from Rigg’s Vantage Point, Falvey Cargo Underwriting Ltd. last year built a 30,000-square-foot building. As of November, the shipping-insurance company moved into the top floor. Now the company is looking to fill the remaining 20,000 square feet.
Even with the slowdown, Riggs said he’s confident that the growth at Quonset isn’t over. He cited the more than 100,000 square feet Riggs & Gallagher owns in three other Quonset buildings, which are full.
“I would say that Quonset Point continues to be a strong area within the overall market,” he said. •
