Aug 5, 2008 6:39 pm US/Eastern
Economy Leads To Empty Commercial Real Estate
Reporting
Adam May
JESSUP, Md. (WJZ) ―
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The troubled economy isn't just hitting individuals; it's affecting small businesses.
CBS
The troubled economy isn't just hitting individuals; it's affecting small businesses.
Adam May reports in Maryland that has led to a quick increase in vacant commercial real estate.
A strip mall in Jessup is brand new and yet has space after space sitting empty, with no tenants to sign leases. The lights are on, but no one's leasing. The commercial real estate market is in the tank, and in Maryland, no place is seeing the effects more than the Route 1 corridor, historically cheap and with high turnover. Office space here is now 26% empty, up from almost 19% last year.
"We've seen fallout from a tremendous amount of businesses that are related to the home industry. That started to impact us around late fall," said Allan Riorda with KLNB Real Estate.
What's happening here around the Route 1 corridor is a lot worse than what's happening in the rest of the Greater Baltimore metropolitan area.
Still, experts say we're in an unhealthy commercial real estate market. Right now, the entire metro area is seeing an 11% office vacancy rate, just above what is considered a healthy rate of 10%. That's up .3 since last year.
Another reason is a gluttony of new office space built prior to this economic slowdown.
In the meantime, prices are dropping and some places are now offering unbelievable specials. One was as low as $6.95 a square foot.
Harford County has the strongest commercial real estate market in Maryland, with less than five percent vacancy.
(© MMIX, CBS Broadcasting Inc. All Rights Reserved.)
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