Commercial market, retail development remain strong

According to local real estate professionals at Follman Properties?ONCOR International, the commercial real estate market in Springfield remains strong.

As in other areas of the country, Springfield has seen a tremendous amount of new construction of office product, as well as increased leasing activity for retail and industrial space, according to a Follman Properties release.

Springfield's retail market is holding steady now, as many retailers are moving into space to take advantage of the holiday shopping season, the release stated. New retail growth, primarily neighborhood shopping centers, has been concentrated along Republic Road, between National and Fremont, just south of James River Expressway. In addition, more retail developments are proposed along James River Expressway and Kansas.

The office market, which has seen tremendous construction in the past year, is starting to absorb some of the pre-existing vacant office space, as well as the new construction. Lease rates have remained fairly consistent, although some of the newly constructed space, due to increased competition, has been leased at below market rate, according to Follman Properties.

Lease rates for new office product range from $13 to $15 per square foot, and second-generation office space leases for an average of $12 per square foot.

Mark Snow, sales and leasing associate with Follman, said he is beginning to see a definite trend in Springfield's office market.

"Owner-occupied buildings, office condominiums and build-to-suits are becoming more common, as people want to build equity in their business. In addition, land costs are very reasonable in Springfield, with office ground selling for $5 to $7 per square foot," Snow said in the release.

He added, "Springfield's industrial market will remain steady, but Joplin will lead the way in 1999 with a new 590-acre business and distribution center. Phase I of the center, currently under construction, is scheduled to open this spring. Joplin has been very aggressive in offering tax and enterprise zone incentives, which will be a huge draw for out-of-town industries, although Springfield will hold its own, especially with local companies."

As 1999 draws closer, the commercial real estate market in Springfield will continue to see steady growth, the Follman release stated. Construction of new office product will continue, although it will not be as brisk as it once was, as demand is still catching up with supply. Retail development will continue, with more "big box" users and neighborhood shopping centers spreading to outlying areas.

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