Mixed-use commercial real estate fares better

Majestic Glove’s new building includes space for tenants. Some of it already is leased.

Gregg Riva, a senior vice president with Colliers International who represented Majestic Glove in real-estate transactions for a new headquarters, said most landlords with local industrial space weathered the past few years much better than property owners with office-only space to lease.

For example, in the third quarter of this year, more than 13 percent of office space in the area that includes the south half of Snohomish County was empty. For industrial and so-called flex space, which can accommodate both offices and industrial uses in one building, that vacancy rate was 7.4 percent, according to Colliers.

Riva added that average lease prices for industrial space in the south Everett area also has stayed higher than in other Puget Sound markets during the recession. Some of that has been due to the demand for space from Boeing suppliers who want to be close to the Everett airplane factory.

“Boeing has an effect, of course, but there are plenty of other businesses up there that are not Boeing-related that take advantage of the space up there,” Riva said.

Also, unlike office and retail spaces that can be relatively easy to move in or out of depending on economic conditions, warehouse and manufacturing space doesn’t tend to be affected quite as quickly, said Tom Hoban, chief executive officer of the Coast Group of Companies, an Everett-based commercial real estate firm.

“Both the industrial and apartment sectors have held up reasonably well because they’re tied to core functions,” said Hoban, whose firm manages more than $1 billion in properties. “People still need a place to live and things break and need to be replaced through manufacturing.”

Hoban said there is a ray of hope for the office space market, where demand waned dramatically during the recession. Vacancy rates for office space in the Snohomish County area are estimated at 13 percent or more, depending on the specific area.

“There’s finally some firming up in that sector, especially in the south end of Snohomish County,” Hoban said, adding that it will take longer for real improvement to reach Everett’s office market.

More in Herald Business Journal

Delta’s farewell tour for the Boeing 747 stops in Everett

It is the last domestic airline to retire the iconic plane. Boeing and Delta employees autographed it.

Sign of the future: Snohomish business aims to reshape industry

Manifest Signs owner thinks that smart signs is an unexplored and untapped part of his industry.

Boeing says Bombardier dumping puts 737 planes in jeopardy

“If you don’t level the playing field now, it will be too late.”

Snohomish County’s campaign to land the 797 takes off

Executive Dave Somers announced the formation of a task force to urge Boeing to build the plane here.

A decade after the recession, pain and fear linger

No matter how good things are now, it’s impossible to forget how the collapse affected people.

Panel: Motorcycle industry in deep trouble and needs help

They have failed to increase sales by making new riders out of women, minorities and millennials.

Costco rises as results display big-box retailer’s resiliency

Their model has worked in the face of heightened competition from online, brick-and-mortar peers.

For half of Americans, the stock market’s highs don’t help

Fewer than 14percent of American households directly own stock in any company.

Tax reform needs the public’s input on spending priorities

The GOP tax plan is a good idea, but the next step should give us a voice on how taxes are spent.

Most Read