The pendulum is swinging back in favor of commercial property owners, according to a Fort Wayne office space market survey.
Vacancy rates decreased to 16.6 percent from 17.3 percent during the period of September 2012 through August. That means there is more than 2.1 million square feet of available space for sale or lease in Fort Wayne.
I would say overall it’s an upbeat report, said Steve Zacher, president of The Zacher Co., which released the survey this week. It’s not as much a tenant’s market anymore, and it is moving toward the landlord’s advantage.
A simple case of supply and demand, he said.
It’s a combination of companies expanding and the fact that there aren’t any (major) office buildings being built.
Zacher Co. and its affiliate, CORFAC International, calculate the vacancy square footage using data compiled from a combination of online data from multiple major listing services, and brokers’ listing information from their websites and mailings.
The report highlighted several investments, including Franklin Electric, The Harrison and BRC Rubber & Plastics Inc.
Franklin Electric has built a new headquarters and engineering center near Fort Wayne International Airport. The company transferred 215 jobs from its former Bluffton operation.
The $38 million development includes an 110,000-square-foot building, equipment and furniture.
Last month, officials celebrated the leasing of 43 luxury apartments at The Harrison, a mixed-used office building.
The $18.5 million, four-story structure has apartments on the third and fourth floors. Retail space on the first floor houses 3Rivers Federal Credit Union and O’Reilly’s Irish Bar & Restaurant. The law firm of Carson Boxberger LLP takes up the second floor.
Mike Meyer, executive vice president for BRC Rubber & Plastics, said the company is investing at least $1 million at 1029 W. State Blvd. in a move to Fort Wayne from Churubusco.
We needed the space and it met our needs, he said. The remodeling is underway. We hope to be in there by the end of October.
Zacher said BRC fills a 27,350-square-foot space that had been on the market since 2004. The market, however, faces challenges, he said.
Telecommuting is creating a void in office buildings as companies look to save money on overhead by having permanent workers at remote locations.
Firms are also using existing space rather than constructing new buildings, Zacher said.
Companies are figuring out ways to get more people in offices through more efficient layouts, he said. One example is putting people in cubicles instead of private offices and things like that.