Businesses are moving into higher-quality, newer spaces as they recover from the recession and rents continue to drop.
McCormick & Schmick’s is one of many tenants upgrading to a nicer space, as revenues increase for companies but real estate deals and concessions get sweeter.
Businesses tend to upgrade from class-B to class-A spaces to expand, to increase their images, or to move to newer, greener buildings.
Jeff Borlaug, vice president and director of brokerage with NAI Norris, Beggs & Simpson, has seen the trend before. He said it tends to occur at the end of a rough economic stretch, when some sectors begin to recover.
“We see this happen in most real estate cycles,” he said. “We’re at the brief point right now where business has generally picked up and businesses are feeling a sense of urgency to take advantage of the bottom of the market. But real estate lags the economy, so landlords are still willing to make good deals.”
Read the entire article at the Daily Journal of Commerce.
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