2010 Global Market Report - NAI Commercial Real Estate

Portsmouth, New HampshireAtlantic County, New JerseyContactNAI Norwood Group+1 603 431 3001Metropolitan AreaEconomic Overview2009Population2014 EstimatedPopulationEmploymentPopulationHouseholdAverage Income20,88020,58712,298$76,211The New Hampshire seacoast is the axis of the GoldenTriangle that runs from Portsmouth along the Massachusettsboarder up to Manchester and back to Portsmouth.Seacoast was the ranked the #1 place to start a business inNew Hampshire by Business Week. The area has apopulation of 433,244. The city of Portsmouth was namedone of the top 10 places to live in the US by Money Magazinefive out of the last 10 years.The seacoast office market has experienced a change invacancy. The Pease International Tradeport vacancy rate hasdropped from 18% to 12%. This is attributed to tenantsrelocating from the demolished Parade Mall and the expansionof existing tenancies in the Tradeport.Statistically, New Hampshire entered Q4 2009 in a betterposition than the rest of New England. The recently reportedNew Hampshire unemployment rate at 6.9% was threepoints under the national rate of 9.7%. The loss rate in oneof the largest sectors of the seacoast area is the hospitalityindustry with 1,300 jobs lost and rising. The $610 millionStimulus Package for 2009 awarded to New Hampshire willprovide stability and an increase in jobs. Areas to be affectedinclude but are not limited to highway/bridge infrastructure,weatherization/energy programs, learning institutions anddrinking/waste water infrastructures.Across the harbor from Portsmouth is the Portsmouth NavalShipyard. This facility has a payroll of $361.1 million,accounts for $73 million in purchases in the New Englandarea and contracts for $67 million in facility services. Theplanned second phase of the PortWalk project in downtownPortsmouth has broken ground for 12,000 SF of retail anda 120-room extended-stay hotel. Two phases will follow,bringing roughly 160,000 SF of office, 40,000 SF of retailand 20,000 SF of restaurant space, as well as an undergroundparking garage.The New Hampshire seacoast, with its diverse economy andunique resources, will not only endure the current economicsetback, but will continue to grow as a community andremain in the forefront of economic stabilization.ContactNAI Mertz+1 856 234 9600Metropolitan AreaEconomic Overview2009Population2014 EstimatedPopulationEmploymentPopulationHouseholdAverage Income268,530263,127191,412$71,988Atlantic County’s economy is dominated by both the tourismand casino gambling industries. Efforts are under way todiversify the county’s economy with the development of anaviation research and technology park; however, the bulkof real estate investment remains targeted at hotels, entertainment,housing (to the casino industry) and recreation.In 2009, casino gambling volume declined an average of14% for the county’s 11 casinos. The bright spot of theregion continues to be the Borgata Casino, which openedin 2003. Borgata was the area’s first $1 billion-plus casino.This past year, gambling at Borgata was down a modest 5%.Entering 2008, there were several planned mega-casinoson the drawing board, however, due to the recession onlyRevel Entertainment broke ground and is currently underconstruction.Industrial real estate in the region continues to suffer froma lack of deal velocity. Vacancy rates increased to approximately20% from 18% in 2008. Negative absorption was inexcess of 100,000 SF with a product base of approximately5 million SF. The office market is relatively small for theregion, with just under 3 million SF. The office vacancyrate is approximately 13%, which represents an increaseof about 2% from 2008. Leasing activity remains modest,mostly renewal activity and again, locally driven and casinorelated.The retail sector is the most vibrant commercial real estatesector, owing to the casinos and tourism/summer shoreactivity. Retail vacancy is approximately 7%, representingan increase from 5.5% in 2008. The total retail market isestimated to be in excess of 9 million SF.Despite the recession and declining casino revenue, developershave not given up on the region. Casino Walks retailcenter began its third phase of development with completionscheduled for summer 2010. The Atlantic City community ishoping the future mega-casinos will transform their regionto an over-night destination location similar to Las Vegas.MedianHousehold Income$56,451MedianHousehold Income$55,623Total PopulationMedian Age44.1Total PopulationMedian Age39Portsmouth At A Glance(Rent/SF/YR) Low High Effective Avg. VacancyDOWNTOWN OFFICENew Construction (AAA)Class A (Prime)Class B (Secondary)SUBURBAN OFFICENew Construction (AAA)Class A (Prime)Class B (Secondary)INDUSTRIALBulk WarehouseManufacturingHigh Tech/R&DRETAILDowntownNeighborhood Service CentersCommunity Power CenterRegional Malls$$$$$$N/A17.008.00N/A8.00N/AN/A4.50N/A22.008.00N/AN/A$$$$$$N/A23.0015.00N/A16.00N/AN/A8.00N/A30.0016.00N/AN/A$$$$$$N/A19.0010.00N/A12.00N/AN/A5.00N/A28.0012.00N/AN/AN/A10.0%15.0%N/AN/AN/AN/A15.0%N/A5.0%15.0%N/AN/ADEVELOPMENT LAND Low/Acre High/AcreOffice in CBDLand in Office ParksLand in Industrial ParksOffice/Industrial Land - Non-parkRetail/Commercial LandResidentialN/AN/AN/AN/AN/AN/AN/AN/AN/AN/AN/AN/AAtlantic County At A Glance(Rent/SF/YR) Low High Effective Avg. VacancyDOWNTOWN OFFICENew Construction (AAA)Class A (Prime)Class B (Secondary)SUBURBAN OFFICENew Construction (AAA)Class A (Prime)Class B (Secondary)INDUSTRIAL$$$$N/A18.0012.00N/A14.009.00$$$$N/A20.0017.00N/A18.0015.00N/A$ 19.00$ 14.50N/A$ 16.00$ 12.00N/A12.0%18.0%N/A15.0%18.0%Bulk WarehouseManufacturingHigh Tech/R&DRETAIL$$$2.251.506.00$$$5.004.0012.00$$$3.502.958.0020.0%20.0%20.0%Downtown$ 25.00 $ 45.00 $ 32.00 8.0%Neighborhood Service Centers $ 8.00 $ 12.00 $ 9.00 11.0%Community Power CenterRegional Malls$$15.0020.00$$25.0040.00$ 18.50$ 27.505.00%7.0%DEVELOPMENT LAND Low/Acre High/AcreOffice in CBDLand in Office ParksLand in Industrial ParksOffice/Industrial Land - Non-parkRetail/Commercial LandResidential$$$$$N/A65,000.0020,000.0050,000.0065,000.0010,000.00$$$$$N/A200,000.00100,000.00150,000.00400,000.0055,000.002010 Global Market Report ■ www.naiglobal.com 105