Office space filled at a faster rate in Winston-Salem in the past four years than in any of the other largest cities in North Carolina, an analysis of office vacancies throughout the state shows.
Almost 20 percent of the office space in buildings in downtown Winston-Salem was vacant at the end of 2007, according to Karnes, a market research company based in Charlotte. Karnes collects data from realty clearinghouses in cities across North Carolina each quarter.
At the end of September — the most recent information available — about 8 percent of the office space in Winston-Salem was empty. Those numbers mean the vacancy rate in downtown Winston-Salem dropped by almost 60 percent. The vacancy rate in Greensboro's downtown increased by about 33 percent; in Charlotte, the vacancy rate increased more than 300 percent.
Andrew Jenkins, a managing partner at Karnes, said the drop in vacancies in downtown Winston-Salem could be related to the city's efforts to attract businesses, shops and residences downtown.
"They've been kind of trying to revitalize their downtown, as well as get a stadium in place. … I think that's probably helped in terms of generating demand," Jenkins said. "There's an argument out there that there's a gravitation toward center cities and more urban living, so you might be seeing that across the state."
Winston-Salem's downtown has transformed in the past five years: Empty buildings and vacant storefronts now house restaurants with al fresco dining. There are still empty storefronts along Fourth Street, but the vacancies are dwindling.
Winston-Salem has almost 5 million square feet of office space in its downtown — more than any other downtown in North Carolina other than Charlotte, according to Karnes.
Winston-Salem, too, has the lowest average rent per square foot.
Michael Clapp, owner of Michael Clapp Appraisals — which several times a year compiles information about office space prices and vacancies in Winston-Salem — said new office buildings have not been built in downtown Winston-Salem since 2002. And the space that is here, he said, is priced to rent.
"As of July, the Wachovia Center (now the Wells Fargo building, at 100 N. Main St.) was asking $19.50 a square foot," Clapp said. "That's a very, very attractive rate given the quality of that building. That's the nicest building in the city. And if that building were in Charlotte or Raleigh, in my opinion, it would rent for substantially more."
Ellen Moore, managing director of Caldwell Banker Commercial in the Triad, said Winston-Salem has retained major banks — Wells Fargo still has a presence here, and BB&T owns its building on Second Street. Winston-Salem's downtown revival helps, too, she said.
"When I came here in 1964, downtown was where you went, period," she said. "Then it went through that huge downturn, and now it's on its way on the upswing, and we've far surpassed anything that Greensboro or anybody else has done downtown with our residences and our restaurants."
Jason Thiel, president of the Downtown Winston-Salem Partnership, said Winston-Salem's downtown is "a clear case of supply and demand."
"What you're looking at is the impact of many different small projects … and an environment, really since 2008, where there's really not been new office construction," Thiel said. "The property owners have been willing to make some concessions on rent."
Email
Facebook
Google
Twitter
Favorites
More
Advertisement