Tuesday, July 11, 2006

Meanwhile, on the commercial side...

...things are just peachy. There has been so much focus on residential development over the last few years that commercial development has lagged, and some areas are seeing tight commercial supply across the board.

Can't say that's the case here in SLC, though. Retail has tons of space in all shapes and sizes throughout the Valley, except the southwest. Warehouse and industrial space is easy to find, although finding Class A industrial takes more effort (Word to the wise: there is high-tech space in Utah County and the far south end of the Salt Lake Valley.). The only area that is tight is Class A office space, and that is artificial. The Walker and Kennecott Towers are empty due to renovations. The mall towers are empty due to the LDS Church's plans to tear them down and start over (more on that later). By the time the two renovations are done, a new tower will be sprouting up in the 200 block of South Main. Then the new mall towers will go up, and we'll have Class A office space pouring out our ears.

"But Knute," you say, "I need Class A office space now." Never fear, padwan. Think outside the downtown box. Sugarhouse, Murray, Cottonwood, and Sandy all now have significant quantities of Class A office space, especially Cottonwood. Really want to be downtown? Start out in the burbs and spend the next couple of years forming an investment consortium. When the market sags, snap up one of the historic properties and build it out the way you and your co-venturers want it. That way you can have your HQ in a place with some significance, rather than just another glass box.


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