Friday Aug 07 2009
Bounty of office space sits empty
By: Gloria Young Journal Staff Writer
Creekside signing new contracts
Auburn had an overabundance of office space in 2008 but this year there’s even more, local Realtors say. “There’s a lot of space out there but most of it is concentrated in the big boxes,” said Mike Fluty, Realtor with Coldwell Banker Commercial, this week. Although a large chunk of the available square footage is at the Auburn Municipal Airport Industrial Park, there are several empty or nearly empty office buildings in town, and numerous small buildings advertising space. Courtyard Professional Center on High Street, vacant a year ago, still doesn’t have tenants and recently was taken over by the lender, according to Windemere’s Jack Amick. The property recently was subdivided into condominium spaces in an effort to make it easier to sell. “We just got it approved (with the city), but the lender took it back,” Amick said. Not far away, a three-story building on Elm Avenue near Highway 49 sits unfinished. On Nevada Street, a multi-building venture next door to Regal Cinema has had a difficult time attracting tenants. “Everyone was hoping we’d have Costco across the street and that would have changed the dynamic, but that hasn’t happened,” Fluty said. In addition, another multi-building office complex is planned for the Bell Road area that will add approximately 35,000 square feet more of office space, Amick said. At Creekside Business Park, located behind the train depot off Blocker Drive, the 100,000-square feet of office space is about 77 percent filled, according to Karen Brigg, senior vice president of Eugene Burger Management. But Creekside is attracting tenants. In recent weeks, the Sierra Nevada Conservancy has signed a new lease, and CASA (Court Appointment Child Advocates) has taken offices there. In addition, Brigg is in discussions for a couple of other leases, she said. The center also has a new café. “We’re so lucky, we have solid tenants,” Brigg said. “It think it’s great for Auburn that we’re holding on to the Sierra Nevada Conservancy and bringing in CASA.” At the same time, because of the economic slowdown, plans are on hold for construction of an additional 6,000-square-foot building in the complex, she said. Both Amick and Fluty said that there is activity locally for office space. But most of it is being generated by owners renegotiating their leases or moving to smaller space. “Ninety-five percent of the activity is people moving around within Auburn,” Fluty said. “(Lease) rates have tumbled as much as 25 to 30 percent in the past year.” Fluty estimates there’s about a 24- to 36-month range to achieve some degree of normalcy in the office component. But, he said, light industrial space is holding its own, except at the airport, and retail space is lagging, but has not been impacted as much as office footage. Amick says this is a good time to jump into the commercial market. “It’s definitely the lessee or the buyer’s market,” he said. “Anyone looking to do something, they’re in a good position to get a good deal because there are more (properties) available than there is demand.” Gloria Young can be reached at email@example.com.