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									                                                                                                                                                   COLUMBUS, OHIO                    OFFICE                   SECONd QUARTER | 2007
                                                                                                                                                         C O L L I E R S T U R L E Y M A RT I N T U C K E R | C O L U M B U S , O H I O

                                                                                                                                                         Market Research
                                                                                                                                                         OFFICE         |   S E C O N d Q U A RT E R              |   2007


                                                          MARKET INdICATORS

                                                                                                        2Q ‘07


     NET ABSORpTION..........


                                             RENTAL RATES.............                                                                                   A   city is often seen from the outside: analyzed by its skyline, its
                                                                                                                                                             landscaped grounds, and even its strategic placement of coffee
                                                                                                                                                         houses and restaurants. It may seem as if no actual main trend emerges
                                                                                                                                                         and changes completely from quarter to quarter. A company closes
                     ABSORpTION, CONSTRUCTION &                                                                                                          down an office here, establishes another one there, and a new tenant
                           VACANCY RATES                                                                                                                 occupies the old space.

                                                                                                                                                         During the second quarter for example, the           these properties rise to a threshold where ten-
S q ua r e F e e t - I n t h o u S a n d S

                                             2,500                                                                    25%

                                             2,000                                                                    20%
                                                                                                                                                         Columbus office market continued its upward          ants will no longer be able to afford the afore-
                                                                                                                                                         trend. Vacancy rates continue to decline as they     mentioned amenities or available space in these
                                                                                                                            V a c a n c y r at e

                                             ,500                                                                    5%
                                                                                                                                                         have since the end of 2005, with reductions in       properties decreases to levels where tenants can
                                             ,000                                                                    0%                                all submarkets. Although the data on Columbus’       no longer find enough space to lease or expand.
                                                                                                                                                         positive trajectory describes the overall market
                                             500                                                                      5%
                                                                                                                                                                                                              At this point, Class B space will once again rise
                                             0                                                                        0%                                 picture, the real estate market data during this
                                                                                                                                                                                                              in demand as a substitute for the more expen-
                                                                                                                                                         quarter illustrates that the city is demonstrating
                                             -500                                                                     -5%                                                                                     sive space. This substitution will once again
                                                                                                                                                         a strong demand for Class A office space.













                                                                                                                                                                                                              stabilize prices in all classes of office properties













                                                     Net Absorption            Construction                      Vacancy                                 The overall market is experiencing a higher de-      as the market continues its recovery. Therefore,
                                                                                                                                                         mand for Class A space as a result of various        maintaining an awareness of the dynamic rela-
                                                                                                                                                         factors. Class A space has become the desired        tionships between the A and B spaces in the
                                                                                                                                                         office location, stemming from concerns about        Columbus market will provide both owners
                                                                                                                                                         parking, ease of access, visibility, technological   and tenants with a useful foundation moving
                                                                                                                                                         capabilities and even the environment. This          forward in the years.
                                                                                                                                                         demand will continue until either the price for


                                                                                                                                                                                                               COLLIERS TURLEY MARTIN TUCKER                 
                COLUMBUS, OHIO                     OFFICE                            SECONd QUARTER | 2007

                                          NEW OFFICE CONSTRUCTION pROJECTS
                                          Building Name/Address            SF          Submarket     Delivery   Type     %Leased     to State Route 315. The
                                          Nationwide Marconi               60,000     downtown      3Q 2007    BTS      00%        project garnered significant
                                          AEp - New Albany                 85,000      Northeast     3Q 2007    BTS      00%        attention in recent months
                                          Creekside Gahanna                50,000      Northeast     3Q 2007    Spec     87%         because it was built on
                                          Commercial Vehicle Group         90,000      Northeast     4Q 2007    BTS      00%        the remediated Gowdy
                                          Abercrombie & Fitch Hqtr.        00,000     Northeast     4Q 2007    BTS      00%        Park Landfill. The City
                                          4343 Easton Commons II           0,50     Northeast     4Q 2007    Spec     0%          of Columbus and private
                                          Broad & High                     40,760      downtown      4Q2007     Spec     50%
                                                                                                                                     investors spent $35 million
                                          959 County Line (Andrew Co.)     46,000      Northeast     4Q 2007    BTS      67%
                                                                                                                                     to clean up the landfill
                                                                                                                                     site and build the office
                                          Safe Auto Insurance              50,000     Northeast     Q 2008    BTS      00%
                                          The Offices At Easton            58,000      Northeast     Q 2008    Spec     2%
Time Warner Cable’s 160,000               Tween Brands                     65,000      Northeast     Q 2008    BTS      00%       Duke recently completed
square foot headquarters was              Grange Insurance Building        240,000     downtown      Q 2009    BTS      00%       construction       on    the
completed during the second               Lifestyles Communities           25,000     downtown      2Q 2008     Spec   36%         198,500 square foot office
quarter. The building was                                                                                                           building for Alliance Data
                                                                   Total   1,311,270 SF                           Avg. 79%
developed by Daimler on the                                                                                                         located at Easton. Alliance
remediated Gowdy Park Landfill.                    INVENTORY
                                                                                                                will consolidate into a single building after
It is located near State Route 315                 A survey of the Columbus office market this
                                                                                                                previously occupying 110,000 square feet in
on Olentangy River Road.                           quarter consists of almost 24 million square
                                                                                                                two separate Class B tech buildings located in
                                                   feet of office space comprised of 197 Class
                                                                                                                Gahanna, also part of the Northeast submarket.
                                                   A and B buildings of 25,000 square feet or
                                                                                                                Several other projects are slated for completion
                                                   larger. The office inventory is spread over
                                                                                                                within the year.
                                                   four major submarkets: Downtown/Central
                                                   Business District (CBD), Northwest, North                    In addition to the new completions, 13 buildings
                                                   and Northeast.                                               totaling over 1.3 million square feet are currently
                                                                                                                under construction; all but six are fully leased
                                                   The largest submarket is the CBD which
                                                                                                                with 274,000 square feet available. It is projected
                                                   consists of 32 buildings with 8.1 million
                                                                                                                that these additions will slow lease-up of existing
                                                   square feet, excluding owner-occupied and
                                                                                                                properties; however, the new office space
                                                   government owned establishments.           The
                                                                                                                represents only 1.8% of the total office market.
                                                   combined suburban market is made up of 15.9
                                                   million square feet of office space. During the              VACANCY
                                                   second quarter the suburban office market                    The Downtown submarket’s second quarter
Alliance Data is consolidating its                 added 358,500 square feet of Class A office                  direct vacancy rate of 13.85% was down almost
office space into this 198,500 SF                  space to the inventory. This space was split                 four percentage points from the same period last
building located at Easton. The                    between two buildings: 198,500 square feet                   year (reported as 17.48%). This dramatic drop in
card service provider is moving                    in the Northeast submarket and 160,000                       the Downtown vacancy rate is due in large part
within the Northeast Submarket                     square feet in the Northwest submarket. Both                 to the increase of large leases located downtown
from two Class B buildings it                      buildings entered the inventory fully leased.                in the last three months. The Huntington
previously occupied in Gahanna.
                                                                                                                Center alone leased 66,000 square feet, this
                                                   NEW CONSTRUCTION
                                                                                                                was an impressive feat, as this building began
                                                   During this Quarter, the Time Warner Building
                                                                                                                the quarter with the a vacancy rate of 18%. The
                                                   on Olentangy River Road was completed. The
                                                                                                                total vacancy rate for Downtown was 16.49%
                                                   project was developed by Daimler and features
                                                                                                                due to a large sublease opportunity in the Chase
                                                   160,000 square feet of Class A office space.
                                                                                                                Tower, located at 100 E. Broad Street.
                                                   Additionally, this location enjoys easy access

pROpERTY AddRESS             SALES dATE        SALE pRICE             SIzE SQ. FT.        SALES pRICE/SQ. FT.    SUBMARKET         BUYER
Brewers Yard                 5/5/2007         $3,930,000            26,000             $0.56                downtowm          Grange Insurance
500 Olde Worthington Rd.     5/6/2007         $3,779,7            02,487             $33.45                Northeast         Lexington Realty Advisors, Inc.
4850 E. Main Street          4/30/2007         $6,200,000             5,25              $2.27                Northeast         LHpT Columbus, LLC
2323 W. 5th Avenue           5/24/2007         $5,500,000             6,258              $89.78                 Northwest         Citizens Bank
2545 Farmers drive           4/7/2007         $4,000,000             86,668              $46.5                 Northwest         Scientific Forming Technologies, Corp.
3400 Olentangy River Road    4/6/2007         $2,900,000             25,000              $6.00                North             dBS Companies
davis professional           5/4/2007         $2,570,000             77,407              $33.20                 Northeast         East Main professional Campus, LLC
TOTAL                                          $48,879,171            529,945             $93.06

                                                    COLUMBUS, OHIO                                       OFFICE                              SECONd QUARTER | 2007

        Existing Properties                                                                                                Absorption                                        Construction                                                                     Rent
Class     Buildings   Total Inventory SF   direct Vacancy   Sublease Vacancy   Total Vacancy Rate    direct Vacancy Rate    Net Absorption    Net Absorption                  Completions                                  Under                                  Asking Full
                                                Rate              Rate            Current Q               Q 2007           Current Q - SF      YTd - SF                     Current Q - SF                               Const. - SF                            Service $/SF
 A           7          4,693,360            4.42%            0.48%              4.90%                 5.4%               33,99              86,079                                      0                           285,000                                    $22.3
 B           5          3,448,48            5.2%            2.06%              7.8%                 6.04%               3,785              63,465                                      0                                      0                               $7.23
Total        32          8,4,508            4.7%            .78%              6.49%                 5.52%               65,704              49,544                                     0                           285,000                                    $20.06
 A           28          3,009,729            27.69%            0.37%              28.05%               29.9%                 66,927              03,985                                     0                                      0                               $8.6
 B           23          ,739,084            2.6%            0.39%              22.00%                 22.02%                7,06              2,458                                      0                                      0                               $5.77
Total        5          4,748,83            25.46%            0.38%              25.84%                 27.02%               74,033              6,443                                     0                                      0                               $7.29
 A           28          2,956,350            0.7%            3.73%              4.44%          2.75%                     233,630              235,80                           98,500                               744,999                                    $8.2
 B           23          ,264,48            23.2%            0.00%              23.2%                 9.65%              (45,009)             (33,575)                                    0                                      0                               $6.69
Total        5          4,220,83            4.45%            2.62%              7.07%                 4.92%              88,62              202,235                           98,500                               744,999                                    $7.76
 A           33          4,7,92            9.07%             .79%              0.86%          3.70%                     356,308              359,05                           60,000                                 65,000                                   $9.09
 B           30          2,232,069            6.97%            0.00%              6.97%                 2.08%               9,857              6,404                                     0                                      0                               $7.20
Total        63          6,943,26            .6%            .22%              2.82%                 6.3%              448,65              475,455                           60,000                                 65,000                                   $8.49
                                                                                          SUBURBAN TOTAL
 A           89         0,677,27            7.56%            .87%              9.43%                 8.7%              656,865              698,846                           358,500                               809,999                                    $8.4
 B           76          5,235,634            2.05%            0.3%              2.8%                 2.05%               53,954              95,287                                      0                                      0                               $6.69
Total       65         5,92,905            8.7%            .30%              20.0%                 8.75%              70,89              794,33                           358,500                               809,999                                    $7.85
 A    06      5,370,63                     4.66%            .49%              6.5%                 6.82%              690,784              784,925                           358,500                             ,094,999                                    $9.29
 B           9          8,683,782            8.07%            0.90%              8.97%                 9.06%               85,739              58,752                                     0                                      0                               $6.8
Total       97         24,054,43            6.7%            .27%              7.44%                 7.63%              776,523              943,677                           358,500                             ,094,099                                    $8.39

The suburban direct vacancy rate also                               office and retail complex known as Brewers                                 CENTRAL OHIO SUBMARKETS
decreased more than 2 percentage points                             Yard from the developer Capital South
(from 21.31% to 18.71%) over the last year as a                     Ltd. The purchase comes as this insurance                                               42                                 315


result of heightened lease activity in the North                    company begins its expansion of its current

                                                                                                                                                           33                257
                                                                                                                                                                                                     Worthington            Westerville

and Northwest submarkets. The total vacancy                         offices at 650 S. Front Street. Interestingly,                                                                     270            North
                                                                                                                                                                                                                                                                 62           New Albany

rate, which includes sublease space, also                           Grange had no expectation to move into the                                                   Hilliard

declined from 21.31% to 20.01%, showing                             building; however the company noted that the                              42
                                                                                                                                                                 Northwest                                            Northeast

that sublease space in the market decreased                         development land included in the sale was                                                                                Grandview

during last quarter.                                                what attracted them to the deal.                                                  70
                                                                                                                                                                                             Columbus                          Port Columbus
                                                                                                                                                                                                                                   Airport                              Reynoldsburg

                                                                                                                                                      40                                       CBD                                    Whitehall

                                                                    Another recent sale included the acquisition                                                                          62                                             270

Overall net absorption in the Columbus office                       of 500 Olde Worthington Road by Lexington                                                                      Grove City


market ended this quarter with an astounding                        Realty Trust, a real estate investment trust                                                                        71                                               Canal Winchester

776,523 square feet. This absorption is due to                      focused on single-tenant buildings. Lexington                                                                                                   Rickenbacker Air
                                                                                                                                                                                                                   National Guard Base

space leasing throughout the market and the                         Realty Trust bought the 100,000 square foot                              Huntington Center saw positive absorption of
removal of 155,000 square feet of leasable space                    building for $13.8 million, or $134.50 a                                 40,000 square feet and added 66,000 square
in the MCI/Verizon building on 5000 Britton                         square foot. Inchord, GSW Advertising is the                             feet again in the second quarter. The significant
Road. This positive leasing momentum has                            sole tenant in the building.                                             leasing of Class A space in the Downtown
carried over from the first quarter of 2007 and                                                                                              market further indicates the leasing market is
is expected to continue throughout the year.                        SUBMARKET REpORTS                                                        willing to bear the cost of the upgraded space.
                                                                    dOWNTOWN/CENTRAL BUSINESS dISTRICT                                       Compared to second quarter results from last
                                                                    During the second quarter, the Downtown                                  year, vacancy dropped more than two percentage
The Columbus market realized an increase in
                                                                    submarket continued to attract new Downtown                              points by the second quarter 2007. The total
the number of office sales during the second
                                                                    tenants, thus continuing the positive trend                              vacancy rate which is direct vacancy combined
quarter with seven office transactions. A
                                                                    seen in past quarters. Vacancy rates declined as                         with sublease vacancy has also decreased since
total of 514,000 square feet was exchanged,
                                                                    a consequence of large leases completed at 101                           the first quarter due to significant subleasing
including two multi-building transactions. The
                                                                    E. Town and at the Huntington Center. The                                activity in Chase Tower.
average sale price of these office investments
                                                                    latter being a location which has experienced
was $95.36 per square foot.                                                                                                                  Only two buildings are slated for completion
                                                                    significant leasing velocity in the past two
In May, Grange Insurance purchased the                              quarters. From January to March 2007, the                                during 2007 in the CBD; the Lifestyles
                                                                                                                                             Communities building located at Nationwide

                                                                                                                                              COLLIERS TURLEY MARTIN TUCKER                                                                                                            3
                   COLUMBUS, OHIO                  OFFICE                          SECONd QUARTER | 2007

and Marconi with 125,000 square feet and           spaces totaling 110,000 in Gahanna to a new
the building at Broad & High with 20,000           198,500 square foot Class A building built by
square feet of office space. The Building at       Duke at Easton. Alliance Data’s headquarters            CONTACT INFORMATION
Broad and High has 50% of the building pre-        was the only building completed this quarter            COLLIERS TURLEY MARTIN TUCKER
leased at this time which will have a positive     in the Submarket, but within the next year
effect on vacancy and absorption when it is                                                                                        Steve Falor
                                                   seven new office projects will be completed,
                                                                                                                                   Managing principal
added to the downtown inventory in the             adding 580,000 square feet of office space.                                     325 John H. McConnell Blvd.
fourth quarter. The asking full service rent for   The submarket experienced only a slight                                         Suite 250
downtown office properties increased slightly      increase in lease rates over those from the                                     Columbus, OH 4325
during the second quarter from $19.95/rsf in       first quarter.                                                                  Tel: 64-24-4700
                                                                                                                                   Fax: 64-24-470
the second quarter to $20.06/rsf.
                                                   NORTHWEST-dUBLIN, HILLIARd
NORTH - WORTHINGTON, pOLARIS                       The Northwest experienced the most
The direct vacancy rates in the North              significant gains in absorption over the last
Submarket continued to improve during the          quarter. The direct vacancy rate decreased
second quarter but remained the highest in         from 16.13% in the first quarter of 2007 to
the Columbus Office Market at 25.46%.              a vacancy rate of 11.61% this quarter. This
                                                                                                            Randy Stephens                John Boll
Improving signs for the market include a           dramatic change is in large part due to MCI/             principal, Senior Vp      principal, Senior Vp
                                                                                                              64-24-47              64-24-472
drop in the vacancy rate as well as positive       Verizon reclaiming 155,000 square feet of
absorption of 74,000 square feet of space.         vacant space. The Northwest Submarket also
The vast majority of the absorption occurred       benefited from the completion of the 160,000
in Class A office space with a total of 64,000     square foot Time Warner Building located
square feet being leased. The positive             on Olentangy Road. Time Warner will
absorption was due to five leases of more          occupy 100% of the building, contributing                  Matt Murtha
                                                                                                                Senior Vp
                                                                                                                                        Faye Herriott
                                                                                                                                        Vice president
than 10,000 square feet of space, the largest of   to the decrease in the vacancy rate of the                 64-827-70               64-24-4709

which included 16,000 square feet at the 1111      entire area.
Schrock Building. Asking rates remained
steady from the first quarter of 2007.
                                                   Compared to last quarter, Columbus
NORTHEAST - WESTERVILLE, NEW ALBANY,               continues to attract expanding businesses as
                                                                                                                Doug Falor              Kristy Daniel
GAHANNA                                            tax abatements and governmental incentives                 Senior Associate       Second Vice president
                                                                                                               64-827-887             64-827-887
Vacancy rates for the Northeast Submarket          attract them into the city and into larger
lowerd to 14.45%: an improvement over the          blocks of new space. The demand for Class
vacancy rate from last quarter at 15.48%.          A office space will continue into next
The decrease in vacancy rate is attributed to      quarter as pricing and amenities in high-end
a significant decrease in Class A vacancy. This    space remains attractive. Class B space will
demand for Class A properties offset the 3.5%      continue to remain stable in the coming                     Jeff Carey               Chad Sutley
                                                                                                                Associate                 Associate
increase in vacancy rates for Class B space        quarter, assuming a back seat to newer office              64-827-707              64-827-708

in the Northeast, the negative absorption          properties. The dynamics of Class A and B
of 45,000 square feet also exemplifies this        office space in the Columbus Market will
                                                                                                           This report and other research materials may
trend. The market also experienced a positive      prove to be worth watching in the near future           be found on our website at www.ctmt.com.
absorption of 102,556 square feet in the latest    as rental rates for Class A space inch upward           This is a research document of Colliers Turley
                                                                                                           Martin Tucker – Columbus. Questions related
quarter. Most of this absorption was a result      in the market.                                          to information herein should be directed
                                                                                                           to the Research department at 64-24-
of Alliance Data’s move from two Class B                                                                   4700. Information contained herein has been
                                                                                                           obtained from sources deemed reliable and
                                                                                                           no representation is made as to the accuracy
                                                                                                           thereof. Colliers Turley Martin Tucker is an
                                                                                                           independently owned and operated business
RECENT CTMT TRANSACTIONS                                                                                   and a member firm of Colliers International
                                                                                                           Property Consultants, an affiliation of
TENANT                         SIzE (RSF)          AddRESS                                  SUBMARKET      independent companies with over 240 offices
Excel, Inc.                    92,42              570 polaris parkway                      North          throughout more than 50 countries worldwide.

Excel, Inc                     36,9              550 polaris parkway                      North
Ameritech/AT&T publishing      6,28              2250 Corporate Exchange drive            Northeast
American Home Mortgage         2,59              8425 pulsar place                        North
Mortgage Maintenance           ,950              5770 Clyde Moore drive                   North
The Children’s Center          7,500               690 Shamrock Court                      Northwest
First place Bank               5,27               250 Old Wilson Bridge Road               North
The Guernsey Bank              4,609               400 W. Wilson Bridge Road                North
The Hair Club for Men          3,56               03 Schrock Road                        North


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