For example, locally based Measurement Inc. leased up the entire 35,000 sf of available space even before the company completed its restoration of an 1870s-vintage tobacco building.
"There's strong interest among some companies for Downtown space that's a little funky, a little out-of-the ordinary." Greg Payne, acting director for the city of Durham Office of Economic and Employment Development, tells GlobeSt.com. "That building leased up within a few months."
The Measurement company itself took the restored 55,000 sf of the project. Payne estimates rental rates for similar class B space are in the $16 per sf range.
Significant development activity continues along the nearby I-40 corridor, but Downtown Durham is also picking up speed, development-wise.
"The I-40 corridor is still the hottest thing around, but there's been some shift with growth and development Downtown," Ted Abernathy, executive vice president of the Research Triangle Regional Partnership, tells GlobeSt.com.
One major development sure to boost Downtown is the Streets at Southpoint, a 1.3 million-sf mall due to open next March. But that's only one of several larger planned projects, says Abernathy, It's still being formulated, but American Tobacco plans a mixed-use $250 million renovation that could add almost one million sf of office space.
"It would be a defining project with a huge impact," he says. The project is particularly noteworthy because Durham itself is still a relatively small city. Abernathy expects to see Downtown get more housing and supportive services and continuing renovations at older buildings.
"It's become fashionable to be Downtown and we expect it to grow into more of a 24-hour community," he tells GlobeSt.com. Office vacancy rates are in the single digits, he says. Despite that, however, Payne says some Downtown tenants are finding bargain rents.
Downtown class A space is typically in the $18 per sf to $18.50 per sf range, while suburban rents are more like $21 per sf to $21.50 per sf, he says. But some Downtown office tenants are even finding pockets where they can lease for $1 or $2 less per sf than the going rate, Payne says.
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David Wilkening
David Wilkening began his long journalism career as a police reporter for Chicago-area newspapers. He became a writer-editor for major newspapers in Chicago, Washington, Detroit and Florida. He has been a business editor, political editor and travel editor for newspapers and magazines. He tried for a while to be a political operative but did better as an adjunct college professor teaching English and journalism. He is the author of several books, both ghost-written and under his own name. He is also a widely published freelance writer who currently lives in Orlando.
