The addition of a pickleball venue helped Carroll County reach an impressive milestone: less than one percent vacancy in warehouse/industrial product.
Earlier this year, PickleRage signed a 31,000-square-foot lease at the Londontown Business Center in Eldersburg, taking another large space off the market and helping drop the vacancy rate. By comparison, the vacancy rate for this asset class throughout Maryland is nearly eight percent.
According to Dennis Boyle, Senior Vice President of MacKenzie Commercial Real Estate Services, the Eldersburg, Hampstead, Finksburg, Sykesville and Westminster submarkets continue to benefit from significantly lower occupancy and operational costs, availability of labor to fill positions, and a business-friendly environment — factors that all weigh heavily in commercial real estate decisions.
Photo credit: St. John Properties, Inc.
“Carroll County compares extremely favorably to neighboring counties and states, especially when it comes to pricing,” Boyle said. “The rental rate in the warehouse/industrial class is $8.28, which is substantially below the $9.95 average in the State of Maryland.”
“We are in the labor, not the real estate business,” CBRE’s Spencer Levy told a NAIOP Maryland audience at a Captial Stack event several years ago.
“The availability of talent is often the key factor that drives real estate decisions among companies,” he explained. “The cost of rent amounts to approximately five percent of the expenses for a company, while labor is about 90 percent.”
“Without good people to work and handle the requirements of the company, businesses cannot survive,” Boyle said. “Carroll County has an extremely attractive and diverse labor market, and that goes a long way.”
Research provided by CoStar Group suggests there is nearly 2 million square feet of industrial/warehouse space in the Carroll County submarket. The highest rental rate in the state is in BWI Corridor area ($13.66 per square foot) and the highest vacancy rate is in the Baltimore County West sector (10.2 percent).
St. John Properties is finding similar success with a 92 percent occupancy level at its Liberty Exchange business community in Eldersburg, which includes nearly 300,000 square feet of commercial office, flex/R&D, and retail space.
“Our flex and service-oriented tenants value the property’s central location, offering convenient access to Howard, Baltimore, and Carroll Counties via Route 32 and Liberty Road,” said Matt Lenihan, Executive Vice President of Leasing at St. John Properties. “Our restaurants and retailers also benefit from strong household incomes averaging more than $180,000 within a three-mile radius, and close proximity to regional consumers from Columbia, Ellicott City, and Reisterstown.”
Carroll County government, in partnership with the Economic Development Division, have worked hard to expedite permits and approvals needed to initiate new commercial real estate development projects and tenant build-outs, and the reputation of the region is extremely business-friendly, Boyle said.
“Carroll County stands out as a smart, strategic choice,” said Denise Beaver, CEcD, Director of Carroll County Economic Development. “Our competitive cost structure and business-friendly approach make us a compelling alternative to higher-cost neighboring areas.”
Boyle said that, with the availability of shovel-ready land in the Carroll County area, build-to-suit opportunities can tailor customized real estate solutions for end-users. The company is currently marketing several sites ranging from five to 12 acres, as well as multiple ready-to-move-in spaces between 28,000 and 151,000 square feet.