Why Spend More in a Tough Economy?

A publication of the Bill Gladstone Group of NAI CIR
December 2009
Why Spend More in a Tough Economy?
By Amanda Mull
D
Do you need an excuse to expand or
relocate at an affordable rate? In a tough
economy many businesses are trying to cut
costs and save money. If your company is
expanding or relocating, this is the perfect
time to look into different ways of
building or renovating real estate. Adaptive
reuse, the conversion of an existing
building into an alternative use, could be
the answer. Three local businessmen have
tackled this concept first hand.
Bob Steele, Senior Pastor of Full Gospel
Church of God, found a way to expand
The Learning Center, Christian Childcare
Ministry without building a new structure.
After receiving estimates for expansion
of the childcare center, he discovered it
would be more expensive to build a new
expansion area than to use an existing
building. Understanding the concept of
adaptive reuse, the church purchased
the former Good’s furniture store on the
Carlisle Pike in Hampden Township and
remodeled it into a daycare center.
“It would have cost us at least twice
as much, or maybe two and a half times
as much to build than it was to retrofit the
building. Plus we got a visible location on
the Carlisle Pike in Mechanicsburg, and
the community already recognized us from
the facility we have here. That is a definitely
a benefit,” said Steele.
Steele’s hard cost for the daycare was
$1.1 million ($52.37 per square foot). When
the scenario was presented to Mark Sather,
Vice President of Premier Construction
Group Inc., he said, “to build a brand new
daycare in the exact location it would cost
$110.00 per square foot.”
From the Sales Desk
(Continued on page 2)
In This Issue
t SALE - 1103 N. Front Street,
Harrisburg
"The Burg News" purchased this
2,048 SF property to use the first
floor for their operations.
1-2, 5
Why Spend More?
3-4, 6-7 Current Listings
7
Group Spotlight
8
Holiday Message
717.761.5070 ext. 120
www.BillGladstone.com
LEASE - 1451 Stoneridge u
Drive, Middletown
Milton S. Hershey Medical Center
for temporary warehouse needs.
[email protected]
www.naicir.com
Why Spend More?
The Learning Center is built to reflect a
child’s neighborhood. Each classroom has
its own theme, such as a bakery, flower
shop, and even art gallery. At the former
location their student capacity was capped
at 92 children due to space limitations.
(Continued from page 1)
Another local company on Carlisle Pike
also took advantage of the adaptive reuse
concept. Hooters Restaurants purchased
the former Penske Garage at 6035 Carlisle
Pike and converted it into a full service
restaurant. They kept the original block
a lot more if it is a leaking roof than just
to replace it. If you replace it with rubber,
you get a 10 year warranty," said Cornett.
Along with replacing the roof they
decided to replace other aspects of the
building to save money. In the long run,
"we replaced a fair amount of the plumbing
and electricity. We did this location right
before Hooters changed their prototype,"
explained Corrnett.
Cornett’s hard cost for the Hooter’s
restaurant was approximately $600,000.
($111.11 per square foot). When Sather
(Premier Construction Group Inc.) looked
at this scenario he said “to build a brand
new Hooter’s in the exact location it would
have cost Cornett $169.00 per square
foot.”
Now they have room for 250 students and
have a waiting list.
“When we looked at this 20,000 SF open
space facility with tall ceilings it became
really easy to format the concept of our
school, town and classrooms,” said Steele.
The project was not all smooth sailing.
The church faced issues with the state,
neighbors and the project itself. Before
the church purchased the facility they
went through a thorough investigative
process of what would be involved in the
project. “We did consider and were assured
we would not have to install a sprinkler
system. Once we got into the project, the
State came back to us and said we would
need to put in a sprinkler system. That was
the main issue as far as complying with
code for our property,” stated Steele.
The property was in distress and there
was a parking issue for most commercial
uses. However, the school’s advantage was
that they fell under the code requirement
for the existing number of parking spaces.
The facility was in pretty good shape
when the church bought it. However,
they still had challenges to face when
renovating, such as the plumbing, adding
a full commercial kitchen and an elevator.
When the project started they only had two
restrooms for the entire facility. Now they
have seventeen throughout the facility.
None of the challenges they ran into
delayed completion of the childcare center.
2
walls and the plumbing lines mostly where
they were. However, they installed a new
roof and replaced all the mechanical and
HVAC systems.
Jim Cornett III, Co-President of Hooters
Franchise mentioned that one of the major
issues they faced in the conversion was the
zoning ordinance as it related to parking
and privacy fences. “The only issue we had
at the time (not including the liquor license
application) was installing a vinyl privacy
fence. The neighbors did not want chain
link,” said Cornett.
When they were renovating the previous
building they decided to install a new roof.
"Usually when you refurbish a building,
it is an older building and you have to be
careful with the roof because you can pay
“With Hooters as a concept, people do
not know what we are. Many people think
we are a lot of things that we are not and
it's really unfair. We are just a casual theme
restaurant,” explained Cornett.
Appalachian Brewing Company (ABC)
on Market Street, Harrisburg also had
to deal with building code issues while
converting their three-story warehouse
into a brewery. “When we started searching
for a location we looked into building new,
renovating in general and this building.
Although it turned out it was a lot more
than we ever expected it to be to get this
building into the position it is today. It was
still a pretty good deal for us when we got
it. Benefits from the City and Mayor Reed
really made it feasibly complete,” said
Artie Tafoya, Director of Operations.
(Continued on page 5)
N E W L I STINGS
p SALE – NEC of Hockersville Road & W. Areba Avenue, Hershey
p CONTACT US TODAY
2.77 Acres available for redevelopment in prime downtown Hershey
location. Within minutes of everything Hershey offers, including;
five star Hershey Hotel & Gardens; world famous Hersheypark &
Hershey’s Chocolate World. Directly neighbors a shopping center with
Staples & adjacent to a CVS Pharmacy. High traffic area with strong
demographics.
Bill Gladstone Group of NAI CIR
717.761.5070 ext.120
www.BillGladstone.com
Save Money by Going Green
1.) Most of the energy used by a washing machine
comes from heating the water, and one full load
uses less energy than two small loads. Set washer
loads for “warm” or “cold” wash instead of hot, and
only run full loads.
2.) Televisions and many other appliances use
energy and cost you money even when you are
not using them. Any appliance with “convenience
features” (like instant-on) is drawing power while it's
turned off. “Leaking electricity” costs the average
U.S. house 50 watts of electricity continuously.
3.) For every 10 degrees you lower the temperature
of your hot water heater, you reduce the heater’s
energy consumption by 3-5 percent.
CIR
Commercial Real Estate Services, Worldwide.
717.761.5070 l www.naicir.com
4.) A full freezer is more energy efficient than a
partially full freezer. If your freezer isn’t full, add old
milk jugs filled with water to take up empty space.
5.) Direct current transformers (those little black
boxes that plug into the wall outlet) that recharge
your cordless phone, hand-held vacuum, answering
machine and electric toothbrush draw 2-6 watts of
power, even after the appliance is fully charged.
6.) Computers and monitors in sleep mode and
screensaver mode are still consuming as much
electricity as they do when they’re in use.
Source: www.energyhawk.com
Information concerning these offerings comes from sources deemed reliable, but no warranty is made as to the accuracy thereof, & they are submitted subject to errors, omissions, change of price
or other conditions, prior sale or lease, or withdrawal without notice. All sizes approximate. NAI CIR, 1015 Mumma Road, Wormleysburg, PA 17043 PA License #RB024320A
3
C O M M E R C I A L L I STINGS
www.billgladstone.com/commercial
p SALE/LEASE – 640 S. Enola Road, Enola
1,700 SF freestanding building on Rt. 11. Repair shop with 3 overhead
doors & small office area. Clear ceiling height 12' in front & 10' in rear.
Average daily traffic count on Rt. 11 is 16,824.
p LEASE – 5221 Simpson Ferry Road, Mechanicsburg
1,708 SF self-contained end unit. Surrounded by commercial &
retail uses; neighbors 2 shopping centers. Convenient to US Rt. 15,
Rossmoyne Business Center & PA Turnpike (I-76). On-site parking
available. p SALE – 4450 Paxton Street, Harrisburg
3,200 SF freestanding commercial building with expansive fenced
yard for outside storage & parking. Easy access to all major PA
highway systems. Partially leased to good credit tenant.
p LEASE – 5660-5670 Lancaster Street, Harrisburg
5,220 SF lower level space in three-story building. Self-contained
space with exclusive entrance. Plenty of parking; all spaces in
common.
I N D U S T R I A L L I S TINGS
www.billgladstone.com/industrial
p LEASE – 491-493 Blue Eagle Ave., Harrisburg
p LEASE – 841 W. Trindle Road (Rear), Mechanicsburg
p LEASE – 4700 Westport Drive, Mechanicsburg
p
6,000 & 10,000 SF suites in modern office/warehouse flex facility.
Exposure along I-81 with easy access & less than 1 mile to a full
interchange. 18' clear ceiling height. 1 dock & 2 drive-in doors.
44,625 SF available; subdividable from 1,755-25,575 SF. New
office/warehouse flex building. Situated right off US Rt. 15 at the
Rossmoyne exit - within 0.25 mile of I-76. Dock & drive-in door
combination per bay.
4
3,528 SF masonry warehouse & 1,833 SF partial pole building.
Buildings can be leased separately or together. Great for contractor
storage or shop purposes. Easily accessible from Trindle Road &
centrally located between Carlisle & Harrisburg.
LEASE – 5340 Jaycee Ave., Harrisburg
16,848 SF in modern flex facility. Can accommodate
3,400-9,568 SF contiguous. Easy access off Rt. 22 & quick
connection to I-81. 16' clear ceiling height. Good loading facilities.
Information concerning these offerings comes from sources deemed reliable, but no warranty is made as to the accuracy thereof, and they are submitted subject to errors, omissions, change of
price or other conditions, prior sale or lease, or withdrawal without notice. All sizes approximate. NAI CIR, 1015 Mumma Road, Wormleysburg, PA 17043 PA License #RB024320A
CIR
Commercial Real Estate Services, Worldwide.
717.761.5070 l www.naicir.com
Why Spend More?
Tafoya’s hard cost for the ABC
restaurant was just short of $2 million.
This came to $40.00 per square foot. For
this scenario Sather (Premier Construction
Group Inc.) estimated this building would
cost $150-$170 per square foot, built new.
to code,” said Tafoya.
The building was built in 1915. There
was a situation in which they had to install
a full sprinkler system in the building (very
expensive) and build a new sub-structure so
it met code. “The only way to get through
"The only way to get through the codes and
regulations is to do as they say, and minimize the
amount of cost by being creative. "
Some business owners think new
properties are more economical but this
is not always the case. “Historically,
brew pubs tend to offer themselves with
a more industrial route, that is why we
invested into this building. When we went
into the building, it had 9' ceilings. Until
we got outside and looked at the building,
we wondered where the other 4’-5’ was in
between and we started pulling down the
ceiling and discovered the beams,” said
Tafoya. With these tall ceilings this allowed
ABC to have their brewing system behind
glass so customers could watch the beer
making process.
“The neighbors and the community
respect what we have done. They respect
the fact that we made an investment, and
we continue to do that,” stated Tafoya.
It was not always smooth sailing for
ABC. They had to overcome government
regulations, and labor and industry criteria.
“When you start with a project like this,
ultimately everything has to be brought up
(Continued from page 2)
the codes and regulations is to do as they
say, and minimize the amount of cost by
being creative. I think in most cases, to
meet all the criteria based upon their codes
and regulations, it is nearly impossible. I
would say if you build a relationship with
the person, and you respect them, that helps
you to get them to initially guide you so
you do not make an investment and have to
go back and change it later,” said Tafoya.
These three local businesses recognized
the value in using existing buildings,
instead of building new structures.
Adaptive reuse continues to be a wave of
the future as less and less undeveloped
land is available for development.
About the Author:
Amanda Mull is the Traditional Marketing
Coordinator for the Bill Gladstone Group
of NAI CIR. She holds a Bachelor's Degree
in Communication and Art. She has been
with the Group for two years.
From the Inside Out
By Jerry Krusinski and Steve Moeller of Krusinski
Construction Company, Oak Brook, IL
The article first appeared in the 3rd Quarter 2009 edition of Professional Report Magazine.
So how does an owner make an
educated, informed decision about
whether to convert an existing
building or pass on an unsuitable
property and opt for new construction?
The answer lies in a comprehensive
feasibility analysis that looks at the
financial viability of redevelopment
proposals, design and construction
costs, comparable use strategies, and
other factors.
Some of the key areas that need to be
evaluated include an existing building's
structure, systems, materials, functional
suitability, code compliance, historic and
cultural significance, and adaptability.
Questions to address include:
•
Is the structure sound?
•
What is needed to bring the building
up to modern standards—to make
it safe and to comply with building
codes?
•
What is the condition of the existing
heating and cooling equipment?
•
Is the building historically significant?
•
Does it contain materials that can
be left intact or recycled?
•
Will it qualify for Leadership in
Energy and Environmental Design
(LEED) credits?
•
Are tax credits available to offset
associated refurbishing costs?
•
The answers to these and other
questions will determine whether
a project is economically feasible or
prohibitive.
An appropriate redevelopment strategy
for one owner may not work for another.
Each owner should weigh his or her own
unique situation to take advantage and
gain the necessary support to ensure
success.
5
O F F I C E L I STINGS
www.billgladstone.com/office
p LEASE – Cliffdale Office Park, Camp Hill
Professional office complex with 4 buildings. Office suites available
from 372-1,506 SF. Immediate access to I-83 & PA Turnpike (I-76).
Competitive rates.
p SALE – 121 Locust Street, Harrisburg
6,200 SF three-story office building. Located in the Central Business
District with substantial on-site parking. Excellent proximity to the
Capitol Complex, River Front Park, Federal & County Administrative
Offices and the City Government Center.
p SALE – 27 Miller Street, Lemoyne
15,000 SF remodeled office building with plenty of open space for adaptation to many users. Building lends well for subdivision to create
a multi-tenant office property. On-site parking for 30± vehicles plus
street parking available.
p LEASE – 156 Cumberland Parkway, Mechanicsburg *
4,948 SF available on 1st floor, subdividable. Class A space with easy
access to Rt. 15 & PA Turnpike (I-76). 46 in-common parking spaces.
High profile, well-maintained site; great visibility.
p LEASE – 415 Market Street, Harrisburg
6,542 SF available in the Harrisburg Transportation Center. Suites
range from 277-2,738 SF. Second floor space with elevator access
from grand lobby of train station.
p SALE/LEASE – 2408 Park Drive, Harrisburg
1,500 SF of office space & 4,000 SF of warehouse space available
in this well-maintained & very functional 8,000 SF office/warehouse
flex building. The business park is situated right off Progress Avenue
at the I-81 interchange with hotels, restaurants & shopping nearby.
On-site parking available.
p SALE/LEASE –126-128 Walnut Street, Harrisburg
p LEASE – 30 North Third Street, Harrisburg
3,302-42,238 SF contiguous available in Class A office building:
marble lobby, skywalk to Strawberry Square, Harrisburg Hilton &
Walnut Street garage. Directly across from the Capitol Complex &
Federal Building and within a few blocks from City, County & Federal
Administrative Offices/Courthouses.
9,000 SF building with secured on-site parking for 6 cars. Owner
will lease-back 2,000 SF on top floor. Building is well-maintained;
professional finishes & large offices with perimeter windows. Strong
Central Business District location within blocks of the Capitol
Complex, Federal Building, City/County Buildings & Restaurant Row.
*It is hereby disclosed that a partner in the ownership of this property is a licensed real estate salesperson in the Commonwealth of Pennsylvania
6
Information concerning these offerings comes from sources deemed reliable, but no warranty is made as to the accuracy thereof, and they are submitted subject to errors, omissions, change of
price or other conditions, prior sale or lease, or withdrawal without notice. All sizes approximate. NAI CIR, 1015 Mumma Road, Wormleysburg, PA 17043 PA License #RB024320A
CIR
Commercial Real Estate Services, Worldwide.
717.761.5070 l www.naicir.com
Group
Spotlight
Erica Izer
Marketing Coordinator
Erica is the Digital Marketing Coordinator for the Bill Gladstone Group of NAI CIR. She assists in all
aspects of our digital marketing and strives to strengthen our technological standing by keeping all
of our internet listings up to date and highly promoting all of our properties. Her experience in graphic
design allows her to help create new materials to improve the overall presentation of our listings.
Erica received a bachelor’s degree in communication arts from Ramapo College of New Jersey.
LAND LISTINGS
www.billgladstone.com/land
LOCATION
ACRES
ZONING
TYPE
5140 Jonestown Road & 4 Carolyn Street, Harrisburg, Dauphin County 1.230
General Commercial
Sale
638 Alricks Street, Harrisburg, Dauphin County
1.320
Heavy Industry
Sale
Wyndamere Road & I-83, Etters, York County
1.40
Commercial
Sale
Rt. 743 (Hershey Road), Elizabethtown, Lancaster County
1.5
Commercial
Sale
Milroy & Grayson Roads, Lot 16, Hummelstown, Dauphin County
1.92
Manufacturing District
Sale
Wildwood Park Drive, Harrisburg, Dauphin County
2±
Commercial (good restaurant site)
Sale
1501 Harrisburg Pike, Carlisle, Cumberland County
2.08
Commercial
Sale
6290 Allentown Blvd., Harrisburg, Dauphin County
2.14
Commercial
Sale
East Cumberland Street (Rt. 422), Lebanon, Lebanon County
2.2
Commercial
Sale
N. Baltimore & Rt. 15, Dillsburg, York County
2.29
Mixed Use Center District
Sale
St. Johns Road, Camp Hill, Cumberland County
3.05
Commercial/Office
Sale
1442 Trindle Road, Carlisle, Cumberland County
6.63
Industrial District
Sale
Lena Drive, Lot 15, Mechanicsburg, Cumberland County
6.920
Planned Business Center District
Sale
Rt. 22 & Rt. 39, Harrisburg, Dauphin County
7.70 (6 lots)
Commercial Highway/Office
Sale
Eisenhower Blvd., Harrisburg, Dauphin County
10±
General Commercial
Sale
7700 Derry Street, Harrisburg, Dauphin County
15.51 (8 lots)
Commercial
Sale
100 N. Hershey Road, Harrisburg, Dauphin County
15±
Neighborhood Commercial
Sale
Carlisle Pike (Rt. 11), Mechanicsburg, Cumberland County
19.5
Community Commercial
Sale
Rose Hill Farm, Gettysburg Pike, Dillsburg, York County
47.01
Residential Suburban-2
Sale
Rt. 15 & Rt. 74, Dillsburg, York County
129.480
Commercial
Sale
Milroy & Grayson Roads, Lot 17, Hummelstown, Dauphin County
1.72
Manufacturing District
Sale/Lease
6325 Chelton Avenue, Harrisburg, Dauphin County
3.75
Business Campus
Sale/Lease
550 E. Main Street, Hummelstown, Dauphin County
1.0
Commercial
Lease
US Rt. 11 & PA Turnpike, Lots 4-5, Carlisle, Cumberland County
1.536 & 1.379 Commercial
Lease
Rt. 11 & PA Turnpike, Carlisle, Cumberland County
2.66
Commercial Highway
Lease
Stoverdale Road & Middletown Road, Hummelstown, Dauphin County
5
Neighborhood Commercial
Lease
CIR
Commercial Real Estate Services, Worldwide.
717.761.5070 l www.naicir.com
Information concerning these offerings comes from sources deemed reliable, but no warranty is made as to the accuracy thereof, and they are submitted subject to errors, omissions, change of
price or other conditions, prior sale or lease, or withdrawal without notice. All sizes approximate. NAI CIR, 1015 Mumma Road, Wormleysburg, PA 17043 PA License #RB024320A
7
A Holiday Message from Bill Gladstone
This was a very different year. It certainly made many of
us stop and think. Things we have taken for granted in our
business models for the past 8-10 years were severely shaken.
How could this all have occurred? The retail leasing submarket
dried up. Big box warehouses gave us the highest vacancy
rates (14-15%) we have seen in these past 8-10 years.
Larger commercial and office buildings at current
vacancy thresholds of 9-11% have languished on
the market for much longer than usual.
At this time of year it is not as important why
these events occurred, but rather that they did
occur. Perhaps it shows how vulnerable we
are. When we compare the current market to
previous years we can obviously see this was not
our best year. It was not just about real estate. This
has impacted all businesses in all markets on a global basis;
some impacted more than others. Perhaps at this time of year
it is good to look back on what has occurred (the positives
and negatives) and give thanks that we made it. Maybe not
completely in the condition we wanted, nor in the same sense
that we have in past years. More importantly, we have not given
up.
As you share the Holiday Season with your family and
friends be thankful and happy of what you learned in 2009. As
we focus on 2010, let us take those lessons, not only
the business lessons but the personal lessons; the
humility, endurance and persistence, it required
to help shape our lives and better prepare us for
the opportunities in the years to come.
It was a pleasure working with you and being
involved in your transactions during 2009.
Hopefully the Bill Gladstone Group of NAI CIR
was helpful and instrumental in representing your
properties, finding your real estate need, or simply
providing consultative services helping you maintain
your stability during the year.
We wish you the very best for a pleasant Holiday Season and
look forward to working with you next year!
NAI CIR
P.O. Box 8910
Camp Hill, PA 17001-8910
PHONE:717.761.5070
FAX:
717.975.0752
[email protected]
www.naicir.com
www.BillGladstone.com
BILL GLADSTONE, CCIM, SIOR
Return Service Requested
PRESORTED STANDARD
U.S. POSTAGE PAID
Harrisburg, PA
Permit No. 783