THE VIRGINIAN-PILOT
Copyright (c) 1995, Landmark Communications, Inc.
DATE: Monday, January 23, 1995 TAG: 9501210097
SECTION: BUSINESS WEEKLY PAGE: 18 EDITION: FINAL
SERIES: Forecast '95
SOURCE: By MYLENE MANGALINDAN, STAFF WRITER
LENGTH: Medium: 51 lines
Hampton Roads' commercial real estate industry shows signs of reviving in 1995.
With retail and industrial markets leading the way, brokers and developers are optimistic this year.
``There's good activity compared to what we've been through,'' said M. Albert Carmichael, a senior vice president with Harvey Lindsay Commercial Real Estate. ``Things are starting to turn around.''
According to a recent retail market survey conducted by Old Dominion University in conjunction with local commercial real estate firms, vacancies in retail real estate dropped to 10 percent in 1994, down from 13.5 percent in 1993.
Carmichael points to at least five proposed shopping centers on both the Peninsula and the southside as evidence of the market's growing activity.
The trend is big boxes (100,000-square-foot buildings containing one store) and retailers repositioning themselves because they don't want to be outpositioned by their competitors,'' he said.
Industrial real estate - comprised of warehouses, manufacturing factories and flex space, a mixture of office and warehouse facilities - have shown signs of falling vacancies.
Industrial vacancies dropped to 4.6 percent in 1994, said Robert M. Thornton, a vice president with Morton G. Thalhimer Inc. Realtors.
Vacancies hovered at 5.4 percent in 1993, said Thornton, who conducts the industrial real estate survey for the ODU Real Estate Board.
Occupancy rates have been so high because very few warehouses and other industrial space is available, he said.
As a result, the build-to-suit real estate market, where structures are built to accommodate the specific needs of a tenant client, has been busy.
In the office market sector, rents and property values are rising, said Deborah K. Stearns, a senior vice president at Goodman Segar Hogan Hoffler. But commercial brokers are cautious about the changing conditions, she said.
Although inventory has started to decrease, office real estate brokers must deal with rules and regulations that can impact property values.
For example, NeVa Properties installed new mechanical units last year to meet more stringent environmental standards in Main Street Tower in downtown Norfolk.
KEYWORDS: COMMERICAL REAL ESTATE OCCUPANCY RATES VANCANCY RATES by CNB