Signs of a local economic rebound are mounting. State and local indexes of leading indicators are moving up smartly. New home sales are brisk. Help wanted advertising is gaining ground. A less visible, little talked about indicator, however, continues to languish -- commercial real estate.
The mindless, greed-induced building binge of the '80s has left the region mired in a commercial real estate depression. Legg Mason's recently released annual Office Industrial Market Review shows vacancies approaching alarming proportions. Howard County closed 1991 with a vacancy rate of better than 20 percent. Baltimore City and Anne Arundel County are somewhere around 19 percent. Carroll County ended the year with an astronomical vacancy rate of more than 50 percent. Even in Baltimore County, where things were a bit more stable, unused space at 14 percent was twice the historical norm.
In virtually every case, particularly that of Baltimore City, the problem is made worse by what's happened to Class B space. Newer, snazzier buildings have sapped up what meager demand there is, putting a severe financial strain on owners of older buildings.