In talking with Bentley Pembroke and Phil Dagastino of Commercial Advisors Asset Services LLC recently about the local office sector, they said that while leasing is moving at a slow pace, there are definite signs that activity is picking up.
“Good things will probably continue to improve over the third and fourth quarter of this year, but I don’t expect anything to shoot through the roof,” Pembroke said.
One positive indicator is the return of the lease term. Five to seven years is becoming a little bit more prevalent, whereas 18 months ago, it was one to three or maybe a three to five year term with a cancellation after three, Pembroke said.
“I think companies that have survived and right-sized their business are going to continue to thrive,” Pembroke said.
But it’s not just businesses that will prosper this year and beyond. Other than the Poplar and I-240 corridor and Downtown submarkets, the airport will likely see an uptick in activity as the market turns around, Dagastino said.
“I am starting to see some decent activity or tire-kickers in the airport area, due to the big-box of continuous space and ample parking,” he said.