Commercial Real Estate Picking Up Momentum

Turning Point real estate lists these adjacent two properties totaling 3.29 acres of commercial property for $3.25 million. They are located at the corner of Urbana Pike, Sugarloaf Parkway and Route 80.

The Urbana commercial and office real estate market continues to rebound as retail centers sell out and national tenants have an eye on the community.

Despite a dismal market collapse nationwide in 2008 and 2009, sales and leases of properties in Urbana seem to be getting back on track.

“We are at the beginning of a new market,” said Charles Seymour, owner of Turning Point Real Estate. “The sign I see is the money on the sidelines is coming back into the market.”

Turning Point Center has just one leasable space left in its retail center, a 1,500-square-foot shell. That has Seymour looking at 22 adjacent acres of property for possible expansion.

Andy Brown, chairman of Stanford Properties, said his company has seen a more active 2010. Stanford owns the Urbana Village Shopping Center of about 25,000 square feet located at the intersection of Route 80 and Md. Route 355.

Brown said, “2009 was not the easiest year to lease commercial space anywhere, and that is when we opened. Now we are almost fully leased. To me it has been a fairly dramatic turn.”

That retail center has two spaces left, each about 1,300 square feet. The center includes locally owned restaurants and national chains like Buffalo Wild Wings and Ledo’s Pizza.

“It is about what we expected, providing a mix of national and local tenants,” Brown said. “No one seems to be hurting.”

Frederick County Economic Development Executive Director Laurie Boyer said the trend is good countywide.

“We are definitely starting to see some more activity in the commercial real estate market and hope to see a positive trend throughout 2011,” Boyer said. “Urbana is definitely one of the hot areas for commercial growth and has a lot of great buildings and sites for commercial development. As the closest growth area in Frederick County to northern Montgomery County and with slightly lower lease rates and costs of doing business, Urbana is definitely well-positioned to absorb new commercial projects.”

Seymour credits some of the movement in the market to a new Board of County Commissioners that had pledged a pro-business atmosphere. That pledge, he said, is already translating into better business.

“People had declined to look here because it was difficult to get through the process (planning and zoning). The door that we wanted to open for Urbana had closed, and they were headed to Montgomery County because of these regulations,” Seymour said.

Some small businesses especially felt burdened by the planning and zoning process that Seymour said could be lengthy and therefore costly to navigate.

Frederick County Commissioners’ President Blaine Young said his board wants to make changes to the process that will help spur economic development. The board has reached out to the business community and already has received a list of 40 different items that the community felt government was doing to limit business growth, expansion and relocation.

“The business community has a lot of concerns,” Young said.

Young cited regulations such as requiring homeowners to pull permits to simply replace a broken dishwasher as an example of government regulations gone wrong.

He said his administration will prioritize requested changes and work to address them.

At the same time, local retailers expect to be helped by big tenants like Fannie Mae and Banner Life Insurance Company, slated to move into its new Urbana corporate center in September.

The community is still in the running for the Social Security Administration’s (SSA) 300,000-square-foot data center.

Rick Boyle, vice president of Natelli Communities said, “We have been in discussions” with the SSA. Urbana is one of two locations in Maryland vying for the SSA data center, which is expected to employ 250 workers. The other possible site is on Johnnycake Road in Woodlawn in Baltimore County.

“We are waiting to hear what they decide, us or Woodlawn. I don’t want to jinx it,” Boyle said.

Boyer said the SSA is still finalizing its environmental assessment phase, and he expects a decision on the relocation by the end of the first quarter.

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1 comment for “Commercial Real Estate Picking Up Momentum

  1. February 1, 2011 at 7:40 pm

    Indeed, a new wave of retail and office construction is taking place, according to fourth quarter 2010 U.S. data from Reis Inc. Following a nine-quarter-long hiatus in community and neighborhood shopping center development, the Frederick County submarket saw the completion of 64,000 square feet in 2010. And more is on the way. This year the area is scheduled to see one of its largest deliveries since 1999, with the completion of the 350,000-square-foot Clemson Corner community center, before resuming more moderate annual levels of construction thereafter. After seeing the average office vacancy rate skyrocket to over 22% in 2008, according to Reis, Frederick County office development is also rebounding. A two-year-long lull in office construction is expected to be interrupted this year this with the completion of 35,000 square feet. And Reis reports that additional projects are in the works, with another 45,000 square feet forecast for 2012. Fortunately, the market appetite appears to be strong enough to digest all this space, as retail center vacancy levels are expected to show just a slight hiccup this year before falling again, while rates in the office sector head determinedly lower.

    For more apartment, retail, and office property insights in 200 metro areas and 1,800 submarkets/neighborhoods nationwide, go to ReisReports.com.

    Connie Vitucci

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