Time to Pull the Trigger

One thing that people have been saying about commercial real estate for ages now is that "buyers and renters are looking, but no one is pulling the trigger".  Some of that is because of real and unfounded fears about the economy, some around here is about Connecticut as a place to do business, and some is just the normal foot dragging, exacerbated by the sense that whatever space they might be considering will still be available when they get around to making a decision.

Because this has persisted, there now is a shortage of certain kinds of space and buildings.  So it actually may not be true that it will still be there when a buyer finally decides.  Also, as we all know, there is quite a lag time between signing the contract and closing, and often as well between closing and occupancy (or optimal efficiency).  Therefore, if you have plans for 2015, and they involve increased production, increased distribution, increased employment, or increased sales, now is the time to be pulling the trigger.  It's closer than you think!

Lots of Start-Ups

It makes sense, if you think about it, for the decline of large firm employment to lead to more people starting their own businesses.  Either they were forced to retire early, or they took a buyout, or they just could see the handwriting on the wall.  For any of those reasons, and often with the help of severance checks, unemployment, or retirement benefits, more and more ex-employees are becoming entrepreneurs.  They are pursuing long-term dreams, or filling needs that large firms have abandoned.

Of course, they need different types of space.  That's partially why we are still seeing too much office space on the market, and why flex space, especially in small increments, in greater demand.  Over time, if these new firms prosper, it may lead to new uses for the office space, or for building of more manufacturing and distribution facilities.  Let's hope so!