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The northern Delaware office leasing market had a good 2015, although headwinds are likely this year.
Commercial real estate broker Colliers reported the leasing and sales performance of the Wilmington area in its year-end report for the Delaware and Lehigh valleys.
The story was similar in other sub-markets according to the report from the company, which operates an office in Wilmington.
“When compared to the last half decade, 2015 was an incredible year for the Delaware office market,” said Rick Kingery, vice president office for Colliers in Wilmington. “There continue to be bright spots like north Wilmington & western Wilmington suburbs, but 2016 seems to be bringing with it some headwinds that appear to be slowing the pace of progress, and it is my expectation that the leverage pendulum for the year will be steeply towards the tenant’s favor.”
Leasing in north Wilmington was aided by demand from tenants and a planned conversion of the Concord Plaza office park into a mixed-use project by locally based Buccini/Pollin Group. Relocations from that complex led to tenants looking for other sites in that area.
A question mark in northern Delaware is DuPont Co., which is downsizing operations as it prepares for a merger with Dow Chemical, which also has operations in northern Delaware.
The two companies lease some space, but could also put additional office square footage on the market.
“The momentum built during the first half of the year carried into the last two quarters, and the regional markets ended 2015 on a strong note with decreased vacancy and increased demand. Single digit Class A vacancy has increased demand for Class B space,” the report noted in assessing the overall Delaware Valley Office market.
