RALEIGH, NC-The Mang Group, an insurance advisory firmheadquartered in Raleigh, has inked a deal for 2,622-square feet ofClass A office space in a struggling area of the Triad. Mang istaking up residence at 5400 Glenwood Ave. in the Carolina CorporateCenter.

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Jim Baldwin, a real estate advisor at Coldwell Banker CommercialTradeMark Properties, represented Mang Group in a market where manytenants are actively shopping for deals. With a 20 percent vacancyrate in the Highway 70 Corridor and a 26 percent occupancy rate atthe Carolina Corporate Center, Baldwin negotiated a lease withheavy concessions.

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“The typical model in this area is one month free rent per yearterm, but most landlords are doing more than that and this deal washeavier on the free rent,” Brian Farmer, president of real estateadvisory services for Coldwell Banker Commercial TradeMarkProperties, tells GlobeSt.com. “The landlord also came down on therate.”

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Farmer declined to disclose specific terms of the five-yearlease, but says landlords that offer free rent concessions arepushing for “out of the box free rent” that is attached to the endof a lease term. So a three year lease would run 39 months with thefree rent at the end of the term.

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The Triangle office vacancy rate was 18.3 percent in the firstquarter, according to Karnes Research. Major employers are sheddingspace in the region. So even small leases like Mang’s are welcomeas the Raleigh market looks to absorb space after finally turningthe corner to net positive absorption in the second quarter.

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Elizabeth Raiford, vice president of marketing and research atGrubbs & Ellis in Raleigh, tells GlobeSt.com that much of themovement in the local market is “sideways,” but lease activity isbeginning to pick up.

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“We’re not seeing a lot of absorption yet, but tenants arebeginning to make decisions again,” Raiford says. “That’s apositive trend. We are starting to see tenants looking forlonger-term leases as well.”

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Although concessions still characterize the market, somelandlords are willing to be patient, Raiford says. She describesthe general mood in the market as renewed optimism.

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“The overall sense is that the window of opportunity to get themost competitive rates is starting to close,” Raiford says. “TheRaleigh market is still not in good shape, but people are startingto feel like we are bouncing along the bottom and the worst isprobably behind us.”

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