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The U.S. office market continued its downward spiral in the first three months of the year, marking the worst quarter since third-quarter 2001 and the 9/11 terrorist attacks, according to Colliers International.
National office vacancies rose by nearly 1 percent, to 14.75 percent, at the close of the first quarter. A big contributor to the spiking vacancy rate was a further increase in space available for sublease, according to Colliers. Nationally, available sublease space rose by 7.5 million square feet during the first quarter, to a total of 81.6 million square feet, or 11.1 percent of the vacant office space.
Underscoring the severity of the current recession, all submarkets and space classes in the U.S. registered negative absorption in the first quarter. For the U.S. as a whole, net absorption was a negative 26.7 million square feet, more than double the 11.4 million square feet of negative absorption in the year-ago period.
“Unfortunately, not a ton of good news can be gleaned from the first-quarter office numbers,” said Ross Moore, executive vice president and director of market and economic research at Colliers. “As jobs continue to disappear nationwide, we see a commensurate decline in office occupancy. While the effect is not immediate, the result is basically guaranteed. As we know, job losses escalated in January, February and March — and the prognosis for Q2 is for more of the same … Investors, lenders and owners need to be prepared for the national office vacancy rate to approach 20 percent — and we must steel ourselves for this scenario.”
In terms of office rents, rates fell in almost all markets surveyed. Tenant incentives also increased, with tenants in the driver’s seat as landlords are anxious to maintain occupancies, Moore said.
CCI
CCI Commercial Contractors Inc. was awarded a $3.5-million contract by the Allen County Board of Commissioners for renovations to the exposition center at the Allen County War Memorial Coliseum. The work will begin in June and is scheduled to be completed by September. The project will include the addition of 45,000 square feet of acoustic wall panels, painting, carpeting and mechanical and electrical upgrades.
Strebig Construction
Strebig Construction was awarded a contract for both phases of a hallway area renovation project at Ginsberg Hall at Indiana University-Purdue University Fort Wayne.
One Eleven Design
One Eleven Design recently completed floor plan redesigns and the installation of new furnishings for the Main Street and Rudisill Boulevard offices of WorkOne Northeast.
One Eleven Design also furnished the K21 Health Services Pavilion, which houses several nonprofits that offer health-related services, in Kosciusko County.
Martin Goldstine Knapke
Steve Wesner represented both the landlord, Mark and Marjorie Hoover, and the tenant, Lynn Swager, in the renewal of a lease for space at 2715 Lower Huntington Road. The space houses Waynedale Grooming.
Roger Koehlinger represented the tenant, Jason and Melissa Van Buskirk, in the renewal of a lease for 1,200 square feet of space at 507 E. Dupont Road. Wesner represented the landlord, SJW Investments LLC. The space in Dupont Village West is an A-1 Ink Refill store.
Felderman Design-Build
Felderman Design-Build was awarded the design-build contract for the 12,000-square-foot interior build-out of the Andy Granatelli Hall of Fame Museum in Auburn.
NAI Harding Dahm
Steve Johnson represented both the owner, J.D. Ventures Inc., and the tenant, Praxair, in a lease for property at 1903 Production Road. Johnson also represented J.D. Ventures and the tenant, Custom Decks Inc., in a lease for property at 1901 Production Road.
Carl Diehm and Steve Chen represented the lessor, Cenway/Wayne Alberding, and Zacher Co. represented the lessee, Radio Systems Corp., in the lease of property at 923 Cardinal Court, Auburn. Diehm and Chen represented the same lessor and the lessee, Jemini Fitness LLC, doing business as Curves, in the lease of property at 911 Cardinal Court, Auburn.
Dick Quillin represented National Oil & Gas in the purchase of land at 7525 Coldwater Road.
Stanley Phillips represented both the lessor, Coldwater Road Development LLC, and the lessee, Nhon Thien Nguyen, doing business as Loving Café, in the lease of property at 7605 Coldwater Road.
Mike Dahm and Paul Refakis represented the buyer, Ideal Office Source, and the seller, M and T LLC, in the purchase of the office building at 525 Ley Road.
Chen represented both the lessor, Barry Knoll LLC, and the lessee, Premier Garage, in the lease of property at 6015 Highview Drive.
John Caffray represented both the lessor, LRL Realty LLC, and the lessee, DTE Powertrain, in the lease of property at 4411 Engle Ridge Drive.
CB Richard Ellis/Sturges
Barry Sturges represented the seller, Steak ‘n Shake Operations Inc., and Carolyn Spake-Leeper represented the buyer, Three Rivers Federal Credit Union, in the sale of 1.3 acres at 3750 E. Dupont Road.
Barry Sturges represented both the lessor, Metro Venture LLC, and the lessee, Helmke Beams LLC, in the lease of 5,366 square feet of space at the Fifth Third Center, 202 W. Berry St.
Sam Schenkel represented the seller, KSM LLC, and Brad Sturges represented the buyer, Cook Land Group LLC, in the sales of 1.45 acres at Cross Creek Commons, 2218 Contractors Drive.
Jim Cowan represented the lessor, RBS Developers LLC, and the lessee, Longe Optical, in the lease of 1,330 square feet of space at Shoppes at Southtown, 7625 Southtown Crossing.
Cowan represented both the lessor, 916 West Coliseum West LLC, and the lessee, G & H Management, in the lease of 1,650 square feet of space at 916 W. Coliseum Blvd.
Cowan represented the lessor, American Federated Title Corp., and the lessee, Tower Staffing Inc., in the renewal of a lease for 2,425 square feet of space at Gateway Plaza Shopping Center, 1501 Goshen Road.
Spake-Leeper represented the lessee, Textrix Solutions Inc., and Jessica Howell and Steve Zacher of the Zacher Co. represented the lessor, Braun Wealth Management, in the lease of 2,267 square feet of space at 608 Union Chapel Road.
Brad Sturges represented both the seller, W & S Properties LLC and the buyer, Dupont Auburn Real Estate LLC, doing business as Compass Financial Advisors, in the land contract sale of 6,914 square feet of space on 0.8 acres at 10315 Dupont Circle Drive West.
Spake-Leeper and Karen Spake represented both the lessor, Waterford Enterprises LLC, and the lessee, Staker Consulting LLC, in the lease of 2,677 square feet of space at 9434 Lima Road.
Spake and Spake-Leeper represented both the lessor, Industrial Investors, and the lessees, Bill Kilgore and Doug Stapelton, in the lease of 2,285 square feet of space at 3706 Wells St.
Cowan represented both the lessor, Rees Realty LLP, and the lessee, Ezequiel Aguirre, in the lease of 6,300 square feet of space at 105 Frontage Road, Huntington.
Alex Genova represented both the lessor, Midwest Business Capital, and the lessee, Toenges Orthotics, in the renewal of a lease for 1,200 square feet of space at 1001 N. Western Ave., Marion.
If you have items for the commercial real-estate column, please contact Linda Lipp by e-mail at
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, by phone at (260) 426-2640, ext. 307, or by mail at Greater Fort Wayne Business Weekly, 826 Ewing St., Fort Wayne, IN 46802.
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