So the economy’s improving and businesses are becoming less apprehensive about expanding, relocating or renovating their businesses. That’s a very good thing. But what does that mean for the South Coast? Well, if you haven’t seen the influx of new businesses moving in or others expanding, you will soon enough.
After years of being a mere afterthought for commercial development, Fall River and the surrounding areas are seeing a massive influx of interest. With Amazon’s million-square-foot distribution facility bustling, the former New Harbour Mall seeing new life as the South Coast Marketplace, and the potential of a new casino across the state line in Tiverton, Bristol County Chamber President & CEO Robert Mellion said that the Fall River area has become a destination for companies looking to relocate.
“This is all being driven by activity in Tiverton and the surrounding areas. Companies are seeing the great infrastructure and the reasonable costs to do business here, costs that are much more expensive the farther you go up 495. It’s a bargain compared to that, and there is land available,” said Mellion.
Noting that the Fall River industrial park has just about run out of space, Mellion pointed out the great expansions of businesses there like Raw Seafood, Blount Fine Foods, and Bristol Marine as a good indicator that businesses are here to stay and remain vested in the community. He said that while it’s still tough at times for retailers that rely on local patronage, manufacturing, distribution, and innovation companies are thriving.
“These companies leverage the assets of the area and can sell to other communities outside the area,” said Mellion.
Mellion said other developments include a potential expansion at Saint Anne’s Hospital and Commonwealth Landing’s fourth floor condo construction.
In the commercial real estate realm, Bob Lima, broker and manager of South Dartmouth-based R. P. Valois Real Estate, said the commercial real estate sector should remain on stable ground in 2017 with modest gains for investors. He said the positive direction for commercial real estate this year will be guided by the steadily expanding economy.
“Developers, builders, and investors are optimistic that the industry will continue to grow. The modest economic improvement could temper the pace of real estate activity. All signs point to an upward trajectory even with the uncertainty of the expected rate hikes,” said Lima.
“The interest rates are still at historic lows and have afforded investors and
entrepreneurs the opportunity and confidence to move forward. However, expected rate hikes could deter real estate investors to some extent.”
Lima said inventory in commercial real estate has not been a problem like other areas around the country, although it has become a dilemma in the local residential real estate market.
Incentivize the Rise
Lori Nery, broker and owner of New Bedford-based Coastal Realty said the local commercial real estate market is “very healthy right now... especially the downtown [New Bedford] area!”
“It is exciting to see the downtown bustling with folks going to all the new restaurants, breweries, a bakery, and new retail stores. The old mainstays like the Whaling Museum and the Zeiterion Theatre are complementing one another into making New Bedford a destination city,” said Nery.
“Since we are also a residential real estate company, we are seeing another benefit of the downtown commercial success: demand for downtown residential housing. Single family homes and apartments are quite desirable on the neighboring streets. New real estate surveys show buyers are interested in living in areas that have a high walkability score. This means people want to live in an area where they can walk to shops, restaurants, and even their jobs.”
As for available commercial space, Nery said right now there are fewer than 70 properties in the New Bedford area for sale and a similar number for lease.
“Every business owner has a particular need and it must be a good fit for their business,” she said.
“Often times the existing building will need to be retrofitted to adapt with their needs. The city building department has been working well with new owners to accomplish their goals.”
Nery said many established successful businesses in neighboring towns and cities are looking to expand to the New Bedford area market.
“Many are service industries, such as cleaning companies, counseling centers, as well as a rebirth of banking and lending institutions,” Nery noted.
She said New Bedford specifically has a bit of problem with acquiring entrepreneurs with the tax rate of $35.83 per thousand.
“It is steep compared to Dartmouth’s $15.78 to $17.38 per thousand. But established businesses are a bit more apt to pay the higher rate because of all the city services, accessibility to their products, and the improved co-operation from the various city departments to help their business succeed,” said Nery.
“It is a Catch-22 and a dilemma for most cities. Municipalities need the increased revenue for infrastructure, schools, etc. There has to be a balance, otherwise we will collect those high taxes from very few remaining business.”
All in all, Nery said the future is very promising and her enthusiasm for the current market is clearly apparent in her tone.
“We do see an enthusiasm on the commercial-side buyers, not only in terms of people wanting to purchase properties, but also to buy established businesses,” Nery added. “Our clients see the U.S. economy on the rise!”
Stephen, Kelleher, owner of the Fairhaven-based Stephen Kelleher Architects said that while commercial real estate work has held “steady,” it is municipal and residential construction that has taken off. Kelleher was responsible for the 11,000-square-foot Riverside Landing Plaza which is home to New Bedford’s new Market Basket, and is currently working on the 30,000-square-foot renovation of the city’s State Pier. He is also working on converting a former West Bridgewater wicker furniture business into four rental units.
“There is a lot of commercial space available,” says Kelleher. “You drive by these strip malls and you see the space available. We are doing some commercial tenant fit outs, remodels, and facelifts that have been going on steadily since the Great Recession ended, but that work isn’t nearly as vibrant as the municipal, state, or residential work.”
Kelley Collins, broker and owner of Collins Real Estate in Fall River, said there’s always a need for more commercial inventory as she has expanded out to properties in Providence, Swansea, and New Bedford, but the commercial market is going very strong right now.
“The commercial market has been very strong for the last year now, there are a lot of buyers and listings are selling quickly,” said Collins. “Overall, people are more confident and in our area. Industrial and warehouse spaces are very sought-after.”
Collins said there is ample office space available. In addition to industrial, retail, and office space expertise, Collins is also known as a specialist in mill properties. She said there are still good leasing opportunities in mills, and a number of opportunities to convert the old manufacturing and textile buildings into modern use. She said with the Industrial Park nearly full, high bay industrial locations are highly sought-after.
“There are tons of distribution companies looking for space and there will always be inventory coming on the market,” added Collins.
Up with Downtown
New Bedford Economic Development Council executive director Derek Santos said New Bedford can point to a multitude of developments in the city to be proud of that are either fully underway or that about to get there. The former Polaroid plant in the New Bedford Business Park has been closed since 2006, but Santos said that complex is about to get new life. Or rather, make that three new lives. In addition to Eversource moving their regional hub from the downtown waterfront to the former Polaroid location, Parallel Products is expanding to that site as well as NWD Trucking.
“By the time the summer rolls around, this will go from a vacant complex to a mini park-within-a-park with a renovated new building,” said Santos. “We’re excited about that.”
Milhench Supply Company is also expanding their footprint in the park, and on the Dartmouth side, AHEAD gear is doubling their size, already securing needed approvals from the town.
MDT Tours is putting the finishing touches on a new building there as well. Santos said he can’t yet talk about the plans for the two remaining open spots in the park, although there are purchase and sale agreements in the works.
“The park continues to be a hub of activity as businesses are expanding, moving in, or hiring even more employees,” said Santos.
As many as five mill buildings in the Upper Harbor region of the city are being renovated into residential, market-rate apartments and artist’s lofts, with the recent announcement of a $20 million dollar mill renovation moving forward right down the street from UMass Dartmouth’s $55 million renovation at SMAST.
Santos noted a recent performance at the Z he went to that was sold out, in the dead of winter, with the downtown area bustling with restaurant activity. From the new Moby Dick Brewing Company on Union Street, to Carmines Italian Ristorante at the Candleworks Building, to Greasy Luck Brewery just a few streets up on Purchase Street, downtown New Bedford has become the hub for great restaurants, pubs, and breweries.
Santos said the boutique hotel, located at 222 Union Street and planned to have 68 rooms, a restaurant, and banquet space, just got fully permitted and received its federal and state historic tax credits.
The Waterfront Historic Area League (WHALE) Co-Creative Center, to be located at 39 and 41 Union Street, coupled with infrastructure improvements at the Whaling Museum and Seamen’s Bethel has things all going in the right direction for downtown New Bedford, Santos said.
“We’re really excited about how everything is shaping up in the north and south ends and in the downtown area. It’s all a good indication of what’s going on citywide,” said Santos.
“We may not have the available land like Amazon, but we have many irons in the fire and we are planning on even greater development in the next 18-24 months.”