Harnden Commercial Brokers 2016 Mid-Year Newsletter . . .
Mid-Year Harnden Commercial Brokers Newsletter 2016 Economic Outlook
2016 is off to a strong start for the Maine economy, specifically the Greater Portland Market, with unemployment down almost a full point to 2.8% at the mid-year mark, and down 4% since May 2010. At 2.8%, unemployment in Maine was almost half of that of the rest of the country according to U.S. Bureau of Labor Statistics. The key to this strong start was across the board growth in multiple employment sectors. Education and Health Services led the charge with 4.8% growth over the past 12 months, a continuation of their steady growth over the past ten years.
179 John Roberts Rd, South Portland
Market Overview
In the first half of 2016, leasing activity was quite robust with the most first half leasing activity since 2004. The average deal in the first half of the year was approximately 3,941 SF. Vacancy improved, down .66% to 8.01% since year end 2015. The Downtown market saw a 1.76% drop in vacancy and positive absorption of 68,800 SF. With the tightening of this sub-market we have seen prices go up since year end to $18.24/PSF on a weighted average, modified gross basis. The largest lease of the first half of the year was Prudential’s renewal at Two Portland Square for 51,831 SF. FC Beacon Group also took 17,581 SF of Downtown Class A space at 280 Fore Street. Maine College of Art (380 Cumberland Ave), Troubh Heisler PA (511 Congress St.), Wells Fargo Advisors (Two Portland Sq), and Maine Medical Center (131 Chadwick Street) also all signed leases over 10,000 SF in the Downtown market. After that the majority of the leasing activity was concentrated in smaller deals, fairly well spread out across various sub-markets, with some partiality to the Downtown Market.
. . .
280 Fore St., Portland
511 Congress St., Portland
Looking Forward
A handful of large users currently in the market will trigger new construction downtown. Class A Downtown rents will continue to go up as supply surpasses demand. This will also trigger new construction. Sales activity demand remains very high in the Greater Portland market.
Two Portland Square, Portland
Harnden Commercial Brokers Outlook
Mid-Year Newsletter 2016
Given the current strength of the Maine Economy, it is unsurprising that the real estate market is fairing relatively well. We expect to see the Office leasing market continue to tighten with several large users currently in the market for space and limited new development, planned. In light of current global uncertainty, U.S. commercial real estate is likely to remain an attractive alternative for investors this year. We expect to see interest rates remain at low levels, and a continuance of active acquisitions and disposals of properties across all sectors. Although we do expect to see more growth in the capital markets, we expect to see the pace of growth slow after multiple years of recovery and price appreciation. *Greater Portland- Portland, South Portland, Falmouth, Westbrook, Scarborough
HARNDEN COMMERCIAL BROKERS
Jim Harnden President 207-650-3677 [email protected]
Sam LeGeyt Associate 860-866-8345 [email protected]
106 Lafayette Street Yarmouth, ME | 207-773-8300 | www.harndencommercialbrokers.com
2016 is off to a strong start for the Maine economy, specifically the Greater Portland Market, with unemployment down almost a full point to 2.8% at the mid-year mark, and down 4% since May 2010. At 2.8%, unemployment in Maine was almost half of that of the rest of the country according to U.S. Bureau of Labor Statistics. The key to this strong start was across the board growth in multiple employment sectors. Education and Health Services led the charge with 4.8% growth over the past 12 months, a continuation of their steady growth over the past ten years.
179 John Roberts Rd, South Portland
Market Overview
In the first half of 2016, leasing activity was quite robust with the most first half leasing activity since 2004. The average deal in the first half of the year was approximately 3,941 SF. Vacancy improved, down .66% to 8.01% since year end 2015. The Downtown market saw a 1.76% drop in vacancy and positive absorption of 68,800 SF. With the tightening of this sub-market we have seen prices go up since year end to $18.24/PSF on a weighted average, modified gross basis. The largest lease of the first half of the year was Prudential’s renewal at Two Portland Square for 51,831 SF. FC Beacon Group also took 17,581 SF of Downtown Class A space at 280 Fore Street. Maine College of Art (380 Cumberland Ave), Troubh Heisler PA (511 Congress St.), Wells Fargo Advisors (Two Portland Sq), and Maine Medical Center (131 Chadwick Street) also all signed leases over 10,000 SF in the Downtown market. After that the majority of the leasing activity was concentrated in smaller deals, fairly well spread out across various sub-markets, with some partiality to the Downtown Market.
. . .
280 Fore St., Portland
511 Congress St., Portland
Looking Forward
A handful of large users currently in the market will trigger new construction downtown. Class A Downtown rents will continue to go up as supply surpasses demand. This will also trigger new construction. Sales activity demand remains very high in the Greater Portland market.
Two Portland Square, Portland
Harnden Commercial Brokers Outlook
Mid-Year Newsletter 2016
Given the current strength of the Maine Economy, it is unsurprising that the real estate market is fairing relatively well. We expect to see the Office leasing market continue to tighten with several large users currently in the market for space and limited new development, planned. In light of current global uncertainty, U.S. commercial real estate is likely to remain an attractive alternative for investors this year. We expect to see interest rates remain at low levels, and a continuance of active acquisitions and disposals of properties across all sectors. Although we do expect to see more growth in the capital markets, we expect to see the pace of growth slow after multiple years of recovery and price appreciation. *Greater Portland- Portland, South Portland, Falmouth, Westbrook, Scarborough
HARNDEN COMMERCIAL BROKERS
Jim Harnden President 207-650-3677 [email protected]
Sam LeGeyt Associate 860-866-8345 [email protected]
106 Lafayette Street Yarmouth, ME | 207-773-8300 | www.harndencommercialbrokers.com
