A little more than a month ago, Webridge cut back to about what it expanded into, putting 48,000-sf on the sublease market at a discounted price, half of it plug-and-play and half of it unimproved shell space, leaving the 95,000-sf building 37.5% occupied.
Between those two events, and smack dab in the middle of the recession, the identical 1915 Building was delivered at a much higher price point. Including a 6,000-sf lease that was signed last week, the building is 8.5% occupied.
Jim Edwards, the local SVP of Birtcher Real Estate Group, tells GlobeSt.com that the situation prompted Birtcher recently to restructure its lease deal with Webridge and reclaim the space on a direct basis. "It is good news in that it puts them in better position to be long-term, rent-paying tenant for us," says Edwards, "and takes them out of the subleasing business so we are not competing with our own space."
Edwards says that although it may be hard to see, the market is slowly picking up momentum. "Activity levels are in fact picking up; it's not something you get real excited about because it's going from a dead stop to a slow go-ahead, but we're seeing an increase," he says. As for the near-term future, Edwards says "we'll make our business plan out of smaller transactions."
As for the newest lease at the newest office building at AmberGlen, Pacific Benefits Group, a national provider of health, dental, life and disability insurance coverage, took 6,000 sf for an undisclosed term in a lease deal that Birtcher values at over $1 million. Annual asking rates in the 1915 building are believed to be in the mid-$20s per sf, the low $20s for the 1925 Building.
Edwards says it is more exciting than the typical 6,000-sf lease for two reasons. The first is that there's not much to get excited about these days. His second reason: "It's a non-tech company."
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