As business owners, the commercial real estate market is probably important to you. Not only may it directly affect the success of your business, but it also probably has an impact as you either rent or own commercial space in which to house your business. Whether you are considering moving your business to another location, building a new office space, leasing space or even interested in owning commercial real estate yourself, having all the information on the current market is always a good idea. As a consumer, it’s always good to be up on the new areas in town that are being developed and are enhancing our city and economy. We’ve talked with professionals in the local commercial real estate market to give us information on these various topics that are important to our businesses and our lives.
How is the current commercial real estate industry in Omaha?
Kevin Rhodes, CCIM, President of World Group says, “The commercial real estate industry is improving.
The market struggled in 2009 and in much of 2010. The so-called “Great Recession” caused companies to pull back, hoard cash and reduce employment. That translated into less construction and less expansion. The reduction in employment meant that companies didn’t need as much office space. The prolonged down market has created a great deal of pent-up demand. Companies held off on expansions and were risk-averse during that time. Now that the economy is improving, many companies have amassed quite a bit of cash and are looking to invest. Some of that investment is going to real estate and construction. One of the ways we judge the health of the commercial real estate market is to consider the percentage of space that is vacant. At this time, Omaha’s industrial space is 6.5 percent vacant. Office vacancy is 14 percent and retail is about 12 percent. Those numbers are obviously higher than they were during the boom times but better than they were last year at this time.”
How does this compare to the rest of the U.S.?
“Omaha’s real estate market compares favorably against the rest of the nation in large part because Omaha’s economy is so much better than the nation as a whole,” says Kevin. “Unemployment in Omaha is several percentage points lower than the national average. Unlike many metro areas, we have seen steady increases lately in net taxable sales, non-residential building permits and airport passenger traffic. At World Group, we often entertain real estate developers/investors from other cities. They’re always surprised by Omaha’s economic vitality. In fact, one of the most common things they have been saying lately is ‘I can’t believe you actually have construction cranes here.’”
Why is now a good time to find a new office location?
“While the office market is improving, it’s still a tenant’s market,” explains Kevin. “Not only are tenants enjoying lower lease rates, they are often receiving favorable lease terms. There is also plenty of office inventory available, which gives tenants options in terms of building type, amenities, area of town, etc.”
Why should business owners work with a commercial real estate company/agent?
“Business owners should focus on making money and serving clients in their industry, instead of spending valuable time searching for property and negotiating price and terms,” says Kevin. “At World Group, we have experienced real estate brokers who analyze your business to help you determine exactly what office space and how much office space you need. Because our brokers are so intimately involved in the constantly changing office market, we often know of available or potentially available properties that aren’t even listed. Finally, never forget that real estate transactions are inherently adversarial processes. Even when negotiations are considered “friendly,” you still have people on two sides of a deal who have different agendas. That means you need the support, guidance and advocacy you get from an experienced, talented broker, who is part of a respected commercial real estate firm.”
Why should business owners consider a business suite for their office?
According to Ted Grace of Altech Business Suites, business suites such as theirs provide a secure building with 24-hour card access and video surveillance plus guest entry system. A U.S. Postal Service Cluster mailbox allows each tenant his or her own secure mailbox. “In addition,” says Grace, “our suites offer flexibility with leases short or long term with known fixed monthly costs in contrast to traditional office space with variable costs (i.e. electrical, gas, water, snow removal, maintenance, etc.). Our windowed office suites are furnished or unfurnished and range in size, allowing the perfect tenant fit. All suites are pre-wired for telephone/network, cable TV and Internet access and a Conference Room, Break Room and Private Patio are available for common area use.”
What is one of the new development in town that residents should be aware of?
L Street Marketplace represents one of the newest shopping centers in Southwest Omaha and is located at 120th & L Street. Anchored by SuperTarget, Sports Authority, Best Buy and Michael’s, the Center attracts shoppers from one of the busiest intersections in Omaha.
Grubb & Ellis Pacific Realty facilitates the leasing for L Street Marketplace, on behalf of the California-based Westport Capital, who acquired the shopping center in the fall of 2010. Leasing activity has increased greatly under the partnership. Small shop space in front of the Center is gaining occupancy. A great diversity of retail shops, including Taylor’s Flowers, Verizon, Sports Clips, Bellagio Nails, and Specialty Dental Care join Jason’s Deli, Hardee’s, Okinawa Asian & Sushi, Buffalo Wings & Rings and Smashburger, who satisfy any shopper’s craving.
The in-line stores still have opportunity for new tenants to join the top anchors along with Ulta, Office Max, PetCo., Anytime Fitness, and Books-A-Million. L Street Marketplace allows visibility and easy access to Interstate 80, increasing interest from many parts of Omaha and the region.
Several new retailer and restaurants are scheduled to open this summer. Qdoba and Noodles & Company are currently under construction and Cheddar’s Casual Café construction should begin soon. A soon to be announced national women’s fashion retailer adds to the list of the “Coming Soon” tenants to join the Center.
L Street Marketplace owners are committed to the community and supporting the success of the stores. Several marketing events are scheduled to increase traffic and awareness of the terrific value the Center provides the area. A Spring Fashion
Show is scheduled for May 7th at 11:00am with looks provided by SuperTarget, Shoe Carnival, Maurices, and Sports Authority. Other fashionable tenants will be involved in the day’s activities with special promotions and savings. Independence Day will be celebrated with a Fourth of July Parade on July 2nd, followed by a Back To School sidewalk sale in August. Partnering with Alzheimer’s Association, a Fun & Fitness Day in the fall will provide a great day out for families to enjoy time
together, while raising money for a great charity.
With several exciting new tenants, new signage, parking and façade improvements planned for the development, L Street Marketplace is well positioned to be recognized as one of Omaha’s top shopping experiences.
The commercial real estate market drives much of the economy of Omaha, whether it is building new offices for the local businesses, offering new places to shop and eat or providing affordable and flexible solutions for small business owners. With the success and support of Omaha’s businesses, the commercial real estate market is sure to continue its growth as our local economy comes back to full strength.