Downtown Commercial Vacancies Hit Zero Percent

The five newest buildings in Middletown's Downtown region are at zero-percent vacancy, Commercial Real Estate Agent Trevor Davis announced in a press conference at the Middlesex County Chamber of Commerce Monday.

"The downtown is most exceptional because class A is at zero-percent vacancy, even though class A is only 5 buildings downtown now, the fact that there is no space in any of those is amazing," Davis said.

Commercial space is broken into three classes: class A is buildings built after 1980 with ADA compliance and higher-than-average rental rates; class B is built after 1960 or renovated with elevators or newer buildings without total ADA compliance and average rental rates; and class C, older buildings that have not been renovated, access by stairs only, and lower rental rates.

At this time last year, Davis said, downtown class A vacancy was 7.1 percent.
This reduction in two years' time, said Chamber President Larry McHugh, is remarkable, "especially with all the vacant buildings throughout the state of Connecticut, and we're just the opposite."

Class A buildings downtown are, according to Davis, 213 Court St. (Middlesex Corporate Center), 2 Main St. (Landmark Square/Rite Aid); 237 Main St. (Citizen's Bank); 169-179 Main St. (Plaza Middlesex/Brew Bakers) and 575 Main (Liberty Plaza/It's Only Natural Market).

"In general, low vacancy rates drive up rental rates, economically speaking — supply and demand comes into play there," Davis said.

Figures are for the first quarter of 2011, measured on April 1.

Those gathered included Downtown Business District director Marie Kalita-Leary, Deputy Director of Planning Conservation and Development Michiel Wackers; Director of Planning, Conservation and Development William Warner and Economic Development Specialist Richard Kearney.

Information was gathered, according to Davis, because "landlords and brokers, they share their information with us so we can aggregate it and then analyze it. Our report comes from this survey, where we call 75 office landlords and 100 industrial buildings — that's 1 million square feet of office space and 3.8 million square feet of industrial space, so we really do cover a lot."

The suburban office building market is higher, at 19.9-percent vacancy, Davis said, because the old Weekly Reader building is in foreclosure, "so technically it's not even available as of April 1 … so if we take that out, our availability is 4.1 percent."

The Leadership in Energy and Environmental Design-designated Centerpoint Connecticut campus on the Middletown/Cromwell line, Davis said, has no tenants lined up, so its construction is based on the confidence that tenants will apply in numbers once the seven-building complex is complete.

Centerpoint Connecticut, Davis said, "along I-91 is new green office condominiums and that's a speculative prospect, which is especially rare to see spec office space being built, but because the vacancy rate is so low, the developer decided he could do that and he got the financing. So that's the only place in Connecticut I think you'll see speculative office condos … under construction."

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