Homebuilding permits rose 49% in SeptemberBuilders...

COMMERCIAL REAL ESTATE

November 10, 1993|By Timothy J. Mullaney | Timothy J. Mullaney,Staff Writer

Homebuilding permits rose 49% in September

Builders, gaining confidence, boosted the number of homebuilding permits in metropolitan Baltimore by 49 percent in September, according to the Baltimore Metropolitan Council. But the prognosis is still for a relatively slow recovery.

The council says builders received permits for 984 units in September, up from 661 in September 1992. And permit totals should reach 12,400 for the year, still well below peak 1980s levels of about 18,000. Even next year, council economist Josef Nathanson said, the outlook is for about 13,000 to 14,000 permits.

"It's still continuing what we have come to recognize -- we're experiencing a very slow recovery," Mr. Nathanson said. The strongest sector: apartment construction, where financing is more available and recent tax changes have helped.

Nonresidential construction continued its pattern in September -- better than in some recent years, but still slow. Government work is providing most of the action, but not enough to replace commercial projects of the 1980s.

Developers received permits for $24 million of nonresidential construction, down from $35 million in September 1992. "With the nonresidential, because of the lumpy nature of the market, you can't make a lot of comparisons for month to month," Mr. Nathanson said.

Over the first nine months of 1993, commercial permits have reached $291.6 million and should reach $360 million to $390 million for the year, the council estimates. The annual total was $222.7 million last year, and $307 million in 1991.

The biggest project approved in September in Baltimore was $4 million of interior alterations at Mercy Medical Center. Anne Arundel County issued two $4 million-plus permits to Wal-Mart Stores Inc. for a Wal-Mart and a Sam's Club store in the Russett development. Baltimore County's biggest permit was for $433,000 of office renovations at Greater Baltimore Medical Center.

The Carroll County Sanitary Commission won approval for an $883,000 wastewater treatment plant in Manchester, the biggest project approved in that county. Harford County's biggest permit was for $3.2 million for a community industrial center at Harford Community College. Howard County issued two $2 million permits: one for a new warehouse in Elkridge and one for a county public works department office building in Columbia.

Crafts store to open at Perring Plaza

Federal Realty Investment Trust has landed a new tenant for (( the space that Lionel's Kiddie City vacated at Perring Plaza in Carney, restoring occupancy at the newly refurbished center to 100 percent.

M.J. Designs, an Irving, Texas-based crafts store chain, will open a 34,000-square-foot store Friday, a Federal spokeswoman says. will be the chain's third store in centers owned by Bethesda-based Federal.

"We're one of the leaders in store size," said Mickey Stroud, vice president for advertising at M.J.'s parent company. "Most people think of arts & crafts stores as little boutique stores. We have 25,000 to 35,000 square feet and up. We're basically a discounter, but we don't position ourselves as a discounter."

The store is M.J.'s first in metropolitan Baltimore, though the chain has about a dozen stores in metropolitan Washington and Richmond. Mr. Stroud says the chain plans to expand further in Baltimore.

Lionel Corp. said in June that it planned to liquidate its 28 Kiddie City toy stores.

D.C. office market slips in 3rd quarter

As Baltimore's office market remains stuck in a one-step-forward-one-step-back dance, its more prominent neighbor to the south is moving backward slightly these days. A new report from Spaulding & Slye, the commercial brokerage firm that is a big player in Washington and a smaller one in Baltimore, says that metropolitan D.C.'s overall vacancy rate was 15 percent at Sept. 30, considerably better than national averages.

But tenants moved out of 576,000 square feet more space than they moved into during the third quarter. That's about the equivalent of two midsize downtown Baltimore towers.

hTC "For year to date, the total absorption for the metropolitan area is just 1,434,00 square feet, compared to 7 million square feet in 1992," S&S Executive Vice President Thomas G. Owens said. "This slow growth rate is not unlike our economy in general."

Washington's market -- like Baltimore's -- will tighten because there are no new office buildings coming on line.

But downtown Washington is struggling with a large amount of space available for sublease at below-market rents, Vice President Terrance Ambling said.

"Even with a halt to new construction, vacancy rates have increased as a result of this sublease market."

Spaulding notes as concerns the government cutbacks called for in Vice President Al Gore's "reinventing government" initiative and a possible moratorium of General Services Administration leasing. Such moves could hurt the Washington market, including Montgomery and Prince George's counties.

Montgomery and Prince George's had higher vacancy rates than the metropolitan area average. The rate was 17 percent in Montgomery, 21 percent in Prince George's.

At June 30, the metropolitan vacancy rate also was 15 percent. Montgomery was at 16 percent and Prince George's at 21 percent.

Baltimore Sun Articles
|
|
|
Please note the green-lined linked article text has been applied commercially without any involvement from our newsroom editors, reporters or any other editorial staff.