Montgomery County’s Office Market appears relatively stable based on a survey of 214 A class office buildings. In the September 2012 survey there was a vacancy of 14% and an average rental rate of $25.67 per SF per year. There has been some new construction. The first new Hospital to be built in the past ten years in S. E. PA opens this month in East Norriton, Montgomery County, PA. Einstein’s new Hospital is a 363,000 square foot LEED certified hospital building with 146 private beds and an adjacent medical office building, 100% leased on a 87 acre campus with about 30 acres dedicated to open green space. United Sates history is very visible in Montgomery County. PA Visitors’ Guide says: “Montgomery County was created on September 10, 1784 from part of Philadelphia County. Norristown, the county seat, was named for Isaac Norris, who owned land there. The vistas at [...]

According to recent CoStar Group and PPR reports the Office Market in 2012 performed as expected... Office jobs increased 2.1%, the same as in 2011. Office sales were up 8% and the price of buying an office building increased 4.8%. Due to the correlation between job growth and demand for office space they compare the growth of employment in Total Non-Farm Employment to Office Using Employment, and the Office Use job growth was 1% more than the total non-farm job growth. Office Vacancy fell 50 basis points to 12.3%. Construction starts for Office are way down...Therefore the prediction is that 2013 will be similar to 2012 for the office market with some slow growth in demand and increases in rents. Of course these numbers are references to a National picture. Each region has different growth patterns depending on the local economy. The changes in rental rates year over year (2011/2012) [...]

Lines Blur between Office and Retail Properties While there is very little new office building construction in the Philadelphia Region it sounds like there is new competition for Suburban Office Landlord’s coming from Retail Landlord’s. At a Philadelphia Retail Summit on February 16th representatives from Federal Realty Investment Trust, The Goldenberg Group, Wal-Mart Stores, Regency Centers, PREIT, Brixmor Property Group, RAS Brokerage, A & E Construction moderated by Jerald Goodman of Drinker Biddle & Reath. It was mentioned several times that the retail spaces were being redeveloped-reused for other purposes such as office space and medical office space. With this new competition there still were over 2.3 + million square feet of office space absorbed in the Philadelphia region in 2011. Will this new competitor reduce rental rates? Doubtful — because there is very little new construction of office buildings in the region. For example the vacancy rate for Office [...]

Tens of thousands of businesses can significantly reduce their office rents right now. This is not a government program, so please don’t call them. To be eligible, you have to be: 1. A tenant in good standing 2. Creditworthy 3. Have a lease that terminates in the next two to three years 4.  Be willing to take advantage of a tenant’s market to trim overhead Since landlords are under pressure to keep their buildings filled with quality tenants, it is possible to approach the landlord, and in exchange for extending your lease, you may be able to obtain lower rent, a rent concession, work space improvements, better lease clauses, a new tax base and more. How? Convince the landlord you are serious about leaving. Nothing says “I really can move to another building” more effectively than retaining a tenant representative who knows how to take advantage of current market conditions. [...]