November 13, 2006

Office snapped up

The News & Oberserver, Cary, NC

Neighboring submarkets are also tightening. Two recent deals in West Raleigh plugged at least 85,000 square feet of space. And although space is being built in the RTP submarket, some growing Cary companies aren't biting because the area is not as rich in amenities.

"I think the [Cary] market needs some new product," Barnes said. New and expanding companies have caused the Triangle's office vacancy rate to drop to 13.2 percent from 16 percent two years ago. Developers are building 1.7 million square feet of offices across the region. But Cary has not caught the building bug. There weren't any leasable offices under construction in Cary at the end of September, according to Highwoods. And only 60,000 square feet have been built in the town since 2004.

That's bound to change. Half of the Triangle's 2 million square feet of proposed offices are planned in Cary. And recent deals could nudge those proposals out of the pipeline and out of the ground.

* Capital Associates wants to begin early next year on an 80,000-square-foot speculative office building on Winstead Drive near Weston Parkway. The Cary developer also has town approval to start a 148,000- square-foot building at Crescent Lakeside, but it's not scheduled to start any time soon.
* Highwoods is thinking about starting a 100,000-square-foot office building at CentreGreen Park off Weston Parkway.
* Regency Park of Cary has town approval to start at least two buildings totaling about 425,000 square feet on Regency Parkway.
* Duke Realty has a contract to buy land off Regency Parkway on which it wants to build two 120,000 square footers.
* Intercontinental Real Estate, which this month bought two Sterling Regency office buildings, could build more offices on land it acquired in the deal. Some developers pledge to begin speculative buildings. Others say they will wait until companies commit to space.

Either way, they will fight for tenants such as SchoolDude. Because, as Prevost points out, "We're not going back to an apartment. No way."