In Our View: Early Signs of Recovery?
Local office space vacancies are down; variety is the key to the modest success
Monday, October 22, 2012
Diversity of appeal to local and relocating businesses, plus diversity of companies that grow and move here, could equal success for Clark County in any economic recovery.
Long gone are the days when Northwest cities could rely on timber mills, aluminum smelters or other manufacturing enterprises for economic growth. Now, variety is the key. Witness the Puget Sound's success -- relative to much of the rest of the country -- in not only surviving the Great Recession but preparing to emerge from it.
The same diversity is taking hold to a lesser extent here in the Vancouver-Portland area. Because we have an array of attributes (not the least of which is high quality of life), we're catching the attention of different types of businesses. A Thursday story in The Columbian described one positive effect of diversity: increased activity in office leasing. In Vancouver, office vacancies fell to 13.4 percent in the third quarter, down from 14.7 percent in the second quarter. Encouragingly, that third-quarter office vacancy rate puts Vancouver ahead of Portland (13.5 percent).
Why are office vacancies declining in this region? Well, it certainly didn't hurt when Portland was named "the greenest city in the U.S." by Travel & Leisure Magazine this year. That's got to appeal both to clean-energy businesses and to other companies whose employees place a high value on living in green communities.
Also helping was a designation of Portland as the "fourth-leading high-tech metro area" by The Atlantic Cities blog. Vancouver/Portland might never catch Seattle in developing high-tech companies, but we're certainly making progress in that regard.
As for diversity of companies participating in this growth, two types were described in last week's story. Predictably, out-of-town firms are drawn to this region by its diversity, but local startups are starting to mature as well, and that means moving into bigger or first-time office spaces.
Often, it might be a relatively small space such as the 600 square feet needed by each of two businesses: website firm Fringe Digital Marketing and software company Eurotech Inc. But local firms are maturing into large office spaces as well. On the sixth floor of City Hall (formerly The Columbian's building), marketing and communications firm Alling Henning Associates Inc. has grown to occupy almost all of the 18,200-square-foot sixth floor. In Portland, Puppet Labs leased 25,000 square feet in the Pearl District and Urban Airship wants to add 10,000 square feet of office space.
Adding to the anticipation of possible economic recovery locally is the fact that the private sector is being joined by the public sector in occupying current office space or announcing new projects. One such public entity could be the state government. To the east in Vancouver, a major boost in office space is expected at Northeast 136th Avenue and Northeast Ninth Street, near the Firstenburg Community Center. A veteran developer of state government offices says a three-story, 72,400-square-foot office building is proposed for a 2.5-acre site, and a likely tenant could be the state Department of Social and Health Services.
Granted, there's no need to start stuffing the confetti bags just yet. Unemployment remains high throughout the region and most businesses are struggling just to keep their doors open. But as long as the community remains diverse in appeal and in the recruiting of businesses, there's reasonable hope for a viable recovery.