Office Market

It's spring, and that means it's time to watch the grass grow.Yes, we're talking about commercial real estate.The first quarter of 1994 was a slow time to watch the office market recover -- but it was still recovering, according to Casey & Associates, a Baltimore-based brokerage and management firm.The big deals weren't plentiful, and the key measures of the market's health were more or less where they were at the end of 1993, but the past few years have provided enough drama to tide the players over for a while.

Whiteford, Taylor hires Pinkard to redo leaseOne of the city's biggest law firms is preparing to test its muscle in the office market, as Whiteford, Taylor & Preston signs W. C. Pinkard & Co. to a tenant representation deal in preparation for the expiration of Whiteford's lease in 1995.The firm calls the Signet Tower at 7 St. Paul St. home. Its offices cover 78,000 of the 374,000 square feet in the Trammell Crow Co.-affiliated tower.The Signet Tower is all but fully leased, but it has not been immune from the pressure that emptier buildings have put on rents.

Anshen + Allen catches 'total quality' waveOnly a month after a merger, the San Francisco architecture firm Anshen + Allen is putting its mark on its new Baltimore affiliate, the old Hord Coplan Macht of Charles Village. The first step: a three-day series of seminars in Total Quality Management for the new principals and their staff."Anshen + Allen has been working on TQD (Total Quality Design) for some time," said Ed Hord, a new Anshen + Allen principal. "A lot of what I got out of it was communication with my fellow employees.

Just two years ago, developers were scrambling to line up banks and other big companies as anchor tenants for beautiful new office buildings. Little did they know that the zenith of the early 1990s market would be established by government bureaucracies such as Medicare.Hurt by the recession, companies aren't spending money on new offices as they did five, or even three, years ago.That has left the federal government as the biggest player in Baltimore's office market this year. And with construction of speculative private office space virtually halted, the government could be the biggest force in building for several years.

Metropolitan Baltimore's office vacancy rate climbed above 20 percent during the first half of the year, but there are some reasons to hope that the devastated market is close to a bottom, one of the city's leading commercial real estate companies reported yesterday.The region's overall vacancy rate climbed to 20.5 percent from 19.1 percent at the end of last year, according to the report by W. C. Pinkard & Co. That compares with a rate of about 10 percent reported in a similar study at the end of 1985 by Manekin Corp.

The value of commercial real estate property is expected to remain depressed, perhaps for several years, in part due to a surge in the number of lender-controlled properties in the Baltimore area, a recent study suggests.Approximately 49 office buildings -- close to 10 percent of the Baltimore area office market -- is currently controlled by lenders, according to the W.C. Pinkard report. Those properties represent approximately 3.3 million square feet of space.The properties have been taken over by banks and other institutions through foreclosure or receivership.

A new study says lenders now control nearly 10 percent of metropolitan Baltimore's office space, reflecting the severe recession in the development industry and a market that is "overbuilt."The study released yesterday by W. C. Pinkard & Co. said that lenders have taken control of 49 buildings since January 1990, including the city's biggest office tower and 27 percent of the office space in Howard County."This is a recent phenomenon, probably over the last 18 months," said Jeffrey B. Samet, the Pinkard vice president who wrote the study.

Anne Arundel County officials, worried about slow growth and empty offices around Baltimore-Washington International Airport, have decided that what the area needs is a new identity -- "The BWI Hub."Along with the new moniker comes a $100,000 marketing campaign, announced yesterday by the county's Office of Economic Development. The campaign will attempt to enhance the area's name recognition and give it an edge against its competition -- Hunt Valley, the Interstate 270 corridor in Montgomery County and Tysons Corner, Va.Since 1980, office space near BWI has mushroomed from 3 million square feet to 11 million square feet, but a business downturn and cutbacks on defense projects have left the area struggling to fill vacancies in mid-rise office buildings and in a nearly empty high-rise project, the One National Business Park.

NEW YORK -- In a potential real-estate deal sending shivers through New York's already depressed office market, Citicorp, the city's largest lender to developers, said yesterday that it was negotiating the sale of a vacant 42-story office tower that it holds in foreclosure to Bertelsmann AG. The sale would most likely be at a loss.Bertelsmann, the diversified German concern whose U.S. holdings include RCA Records and Bantam Doubleday Dell, the publishing concern, confirmed the negotiations were going on.If a deal is struck, the price would almost certainly be far below the $250 million mortgage that Citicorp holds on the building.

Now, from the commercial brokerage firm of W.C. Pinkard Inc. comes confirmation that a lot of commercial real estate buildings out there that are short on tenants.That may not be new news for those who have observed the increasing number of "see-through" buildings in the area or have had to cope with recession-driven high vacancy rates. But the situation is worse than even Pinkard imagined it would be.In a report reviewing the local office market, Pinkard executives conclude that the first half of 1991 saw "a collapse" in the rate of office absorption.