In Providence, the Class A office market has stabilized, thanks to a number of large lease renewals last year as well as new activity in the market. The current vacancy rate for Class A office product is now under 9 percent in the Capital City with an overall office vacancy rate of 14 percent, which represents a decrease of 100 basis points compared to this same point last year. Consequently, this activity has pushed rental rates for Class A space back over $30 per square foot on new deals. Recently, Nortek completed a lease for 24,000 square feet at the Blue Cross Blue Shield building located in the Capital Center district of Providence. Tech startup Swipely has completed its move into more than 25,000 square feet at 10 Dorrance Street. But for the Swipely expansion, the downtown Providence Class B office market remains stagnant. There has been some activity on the capital markets front as well in Providence. The Foundry Associates recently completed its purchase of the former American Locomotive Works (ALCO) site, which totals more than 200,000 square feet of redeveloped office space, for $19.05 million. In addition, Providence-based Paolino Properties recently completed the acquisition of 100 Westminster (300,000 …
Rhode Island
In Providence, R.I., the the Class A office market has stabilized. GTECH Center has been successful in leasing up just about all of its available space to four or five tenants. Consequently, The GTECH Building sold for more than $50 million prior to the end of 2012. In addition, the new Blue Cross tower was successful in leasing 10,000 square feet of available space with plenty of continued interest for additional floors from prospects. Also, Bank of America’s move from its former headquarters at 111 Westminster into space located in 100 Westminster and One Financial Plaza has further helped push vacancy rates down for Class A office space. The current vacancy rate for this product is less than 9 percent in the Capital City. Consequently, this activity has pushed rental rates for Class A space back over the $30 per square foot mark on new deals. High Rock Development, which owns 111 Westminster (the former Bank of America building), is currently lobbying the state for tax credits to redevelop the building into apartments. It will be interesting to see, since the 38 Studios collapse, how far the state and city are willing to get involved — or if the building …
Rhode Island is the smallest state in the United States in terms of geographic area. With a population of 1.05 million, it is the eighth least populous state; however, its small geographic area makes it the second most densely populated of all 50 states. This density of population is attractive to retailers looking to expand in The Ocean State. The city of Providence is the only major urban center in Rhode Island. As such, it serves as the cultural and economic hub of the state. Providence Place Mall, one of the most successful urban regional malls in the country, continues to serve as a strong anchor to the downtown area, bringing suburban customers in to the city of Providence to shop and eat at one-of-a-kind retailers and restaurants in the state, including Nordstrom, Cheesecake Factory, Dave & Busters, and Apple. Other than Providence Place, retail activity in the downtown market has been primarily focused on chain restaurants, such as Ruth’s Chris, The Capital Grille and McCormick & Schmick’s, continuing their presence and new local operators opening in the areas adjacent to the downtown core such as Federal Hill (Providence’s “Little Italy”) or along Thayer Street, which is the hub of …
In Providence, 100 Westminster and One Financial Plaza still have ample true Class A space available, but GTECH Center has arguably produced the best return on its tenant investment, essentially leasing up all of its available space to four or five tenants. Consequently, the GTECH Building just sold for more than $50 million. In addition, the new Blue Cross tower was successful in leasing half of its 20,000 square feet of available space. This activity has pushed rental rates for Class A space back over the $30 per square foot mark on new deals. The vacancy rate will dip just below 17 percent as Hasbro officially announced that it has leased approximately 135,900 square feet in the capital city. Finally, it looks like Ameriprise Financial will be moving from Cranston into One Citizens Plaza, which will help the Class A absorption. However, the recent failure of game developer 38 Studios will negatively impact occupancy rates; the company occupied space at One Empire Plaza, a 104,000-square-foot office building in Providence. Looking forward, Bank of America announced that it will vacate its headquarters located at 111 Westminster in April 2013. It is expected that 100 Westminster will absorb employees leaving this 340,000-square-foot …
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