It now costs more than ever to provide workspace for small- to moderate-sized businesses.
According to Grubb & Ellis|BRE Commercial brokers Peter Curry, Mark Avilla and Matt Campbell, this is especially true in greater San Diego County, where soaring land and construction costs, shortage of developable land, and a growing economy combine to make rent increases for workspace virtually inevitable.
The preponderance of businesses in the region is small- to medium-sized, and a number of them are turning to office condominiums as a savvy investment. Office condominiums - office suites that are owned by individuals or companies and are located within a larger facility - continue to appeal to these smaller businesses as a way to gain long-term control over their workspace expenditures.
The attributes of office ownership resemble those of home ownership: Purchasing an office condo enables the business owner to gain long-term control over his workspace expenditures, realize certain tax benefits as well as an appreciating asset, and can serve as a "super IRA" for the owner's retirement.
These reasons, the Grubb & Ellis|BRE brokers said, are why virtually all of the 18 office suites in North Point Ventures' Park Place North in San Marcos' Old Town Business District have been sold well before the December completion of the 40,000-square-foot, three-story Class A office development.
Curry, Avilla and Campbell comprise the exclusive marketing and sales team for the $10 million, 1.6-acre project.
Grantville-based North Point Ventures is developing Park Place North on a triangle formed by Highway 78, San Marcos and South Rancho Santa Fe roads within walking distance of San Marcos' Old California Restaurant Row and neighboring shops and services.
In addition to excellent location and amenities, the buyers of Park Place North's 1,300- to 2,900-square-foot office suites will benefit from a structure distinguished by Mission-style architecture, four surface parking places per 1,000 square feet of occupied space, and common area maintenance fees comparable to those that tenants pay as part of rent for Class A space in the area.
The brokers laud Jeffrey McCormack, North Point Ventures principal, for his thorough study of office condominium projects in other states.
"Jeff assured that Park Place North is a top-quality facility that will certainly appreciate, because it was designed and built specifically for condo purchasers," Curry said. "Some owners have converted existing offices into condos, akin to conversion of apartment projects into residential condos. Just like a lot of older apartment complexes were not really designed for condo usage, many existing commercial buildings were not designed to function optimally as office condos."
McCormack is delighted by acceptance of Park Place North, which will be home to a variety of long established small- to medium-sized businesses. Some of the buyers are taking advantage of the Small Business Administration's loan guarantee programs to finance their condos, and national credit enterprises also are interested in the office condo concept.
McCormack just closed escrow on a nearby parcel for Park Place South office condos, and is planning office condos in the East County and downtown San Diego. Although Southern California lagged behind East Coast cities in accepting office condominium ownership, the demand for first-rate office condos no longer is of question, he said.
For more information about Grubb & Ellis|BRE Commercial, visit www.brecommercial.com.
Submitted by Grubb & Ellis|BRE Commercial