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Commercial growth rapid in Fremont/Primrose area

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The Primrose/Fremont area has become the fastest growing area in Springfield for new development, with an estimated 200,000 square feet of office and mixed- use space projected for development.

Many of the new developments are single tenant and multi-tenant office buildings housing such businesses as MCI, Sinclair Financial, Merrill Lynch and First Financial Consultants.

McAlister's Gourmet Deli is the sole retail development.

The MCI Call Center Building, as well as the Merrill Lynch building, are both build-to-suit facilities located in the 56-acre Primrose Business Park.

Approximately 7,000 square feet of the Merrill Lynch building will be occupied by the Springfield Merrill Lynch office, while the remaining 13,000 square feet is available for lease.

The Castlegate Office Condominiums are also located in the Primrose/Fremont corridor. The first building, at 12,600 square feet, was pre-leased and pre-sold to five tenants and owners prior to the completion of construction. In addition to the first building, three more buildings will complete the Castlegate Office Condominium development.

Most of the new office buildings in the Primrose/Fremont corridor are single-story developments, with the exception of the Sinclair Financial Building. The first phase of this building's construction produced a two-story, 30,000-square-foot structure, the infill of which is now being completed.

The second phase of construction, expected to begin in December of this year, will add four stories to the building, increasing its size to 100,000 square feet.

While pure office development has been brisk in Springfield, companies are also concentrating on back-office facilities and operations centers. The MCI Call Center, as well as the 150,000-square-foot First Card Operations Center, are examples of back-office users who choose to locate in Springfield.

Many of these companies move their operations centers to "second tier" cities which offer lower operating costs and a strong employee base.

There are also several speculative office buildings under construction or already completed around the Primrose-Fremont area.

Leasing activity has not been as brisk as it could be, considering the large amount of office and mixed-use product which will be placed on the market in the next 12 months. Leasing activity is expected to pick up, however, as demand catches up with supply.

"One of the main reasons for the explosion of growth along the Primrose-Fremont corridor is the location," said Mark Snow, sales and leasing associate with Follman Properties ? ONCOR International. "This area provides access to the major transportation corridors of James River Freeway and U.S. 65."

In addition to the location advantage, the quality of office space along this corridor is superior to that in other parts of the city.

"The office buildings are typically newer than others in Springfield, and they offer more visibility, well-planned access and well-designed campus settings." Snow said. "As would be expected, lease rates are higher in this area, averaging between $11.50 and $13.50 triple-net per square foot. The growth in this area is expected to continue, as there are still approximately 45 acres left to develop."

Growth in the real estate industry is keeping up with the region's population boom, as well as its strong economy. Over the past several years, Springfield has seen an average of 100,000 square feet of office space added to the market.

While new office development is expected to continue in the short term, it will most likely diminish as the market becomes oversaturated with office product.

As demand catches up with supply and equilibrium is reached, the Springfield market will be positioned on the upward curve of the real estate cycle, with office development continuing once again.

Retail and industrial development will continue to be strong, further enhancing Springfield's reputation as a regional retail, manufacturing and professional center.

(The preceding article was provided by Follman Properties ? ONCOR International.)

INSET CAPTION:

The MCI Call Center, as well as the 150,000-square-foot First Card Operations Center, are examples of back-office users who choose to locate in Springfield.[[In-content Ad]]

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