Selecting where to start or move a business to is a crucial decision. The correct space and location are key factors in how well the business will do. Choosing a location with an active market for whatever the business delivers is important for sustainability, according to local experts.
Northeast Ohio is full of hot spots for commercial real estate, according to David Leb, associate at Newmark Grubb Knight Frank in Cleveland, and Bob Garber, managing principal at Cushman & Wakefield CRESCO Real Estate in Cleveland.
Businesses looking to move or establish themselves have many areas to choose from. But how do these areas become the hot spots – and why?
Garber said the space depends on the needs of the business. The areas that business owners should look at varies whether they are looking for industrial or office space.
“In terms of both markets, certainly the industrial side, there is very low vacancy,” Garber said. “(Those low vacancies) are driving people into places that we never thought would be as hot as they are now.
“For example, Glenwillow and Solon are up and coming. The Route 8 corridor was a sleeper for many years, but has gotten pretty active in terms of stuff going on. Then, if you’re moving west, you’re still seeing things happen in Middleburg Heights and Strongsville.”
In terms of the office space perspective, Garber said Chagrin Highlands in Beachwood, Highland Hills, Orange and Warrensville Heights, is booming in terms of both multitenant and office buildings.
“I think that if you are thinking of the activeness on the office side,” Garber said. “Those pockets give a good understanding of things that are starting to pop up.”
According to Leb, downtown Cleveland is one of the larger real estate hot spots because of the perks of a live/play/work environment.
“For companies located in the suburbs, they have to give serious thought to how they are going to attract new talent,” Leb said. “Being located downtown gives them a cool factor that suburban properties struggle to achieve.”
Both Garber and Leb said many factors go into creating hot spots in development and real estate, such as land that is ready to develop, accessibility and amenities. Sometimes, though, all it takes is for one person to believe an area has potential, they said.
“In the case of Midtown (in Cleveland), Geis Cos. and Cumberland Development were two developers who made significant investments in the Midtown area, because they had the vision to imagine it as Cleveland’s next burgeoning business district,” Leb said. “Twenty years ago, companies weren’t considering Midtown as a safe and viable option, but now is experiencing tremendous growth.
“That’s something that sports and commercial real estate have in common – the power of momentum.”
Garber said sometimes popularity just comes from something as simple as a population shift. As more and more people move to different locations, a business moves with them.
“It’s all about location, location, location,” he said. “When you run out of land in a city, it’s logical to move to the next one over and so on.”
As for the front-runner of the commercial real estate business, Leb and Garber had differing opinions. For Garber, it’s more general and depends on what the client is looking for.
“If you’re a bulk distribution warehouse user, you’re looking for a more centralized area,” Garber said. “If you’re an office, you want to be around a more realized orientated area. It really depends on (a client’s) goals and business. I think they all have their own merits. Each city has it’s own positives that are drawing people for many different reasons.”
But for Leb, the Ohio City/Detroit Shoreway area is an obvious front-runner in terms of commercial real estate and a potential for booming business in the future. The only problem is that it lacks in office space.
“All of the ingredients are there for a strong office market but supply is lagging demand,” he said. “I would expect more speculative office construction and renovation of buildings in those neighborhoods over the next few years.”
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