Spring brings surge to Princeton office market.

The Princeton market has its own unique dynamic. Just when you think things might be slowing down a bit, a surge ensues and requests for office space begin again in earnest. This spring has been a case in point where after a so-so winter, we are now busy responding to requirements for space ranging from 5,000 s/f to full building occupancy

This is largely a self-generating market. Businesses in Princeton tend to remain in Princeton and as they grow they look to expand in place.

The area has traditionally attracted high- tech research firms, companies serving the pharmaceutical industry and law firms which value the proximity to Trenton as well as being at the the mid-point between Philadelphia and New York City.

And as these market segments have been in a growth pattern for the good part of last decade, most existing Princeton buildings can boast healthy occupancy rates.

As an 11-building office center, College Park's tenants typically move within the park, taking larger space at lease renewals. Since we have been able to accommodate them in terms of their growth and the type of quality office environments they require, College Park is continuing to operate at better than 90% occupancy.

Princeton, as other U.S. markets, is being impacted by global factors. The cost of energy and the unsettled geoeconomic climate are obviously playing an big role in corporate decision making. The continued war in Iraq, the instability of the oil-producing countries and and the resulting spiraling cost of energy is affecting everyone's bottom line. It's not that companies are looking for real estate bargains, they're just being cautious and are reluctant to commit to a major investment.

There are currently 3 new speculative office building in the Princeton market but the asking rents of $30 to $35 are meeting with resistance while the $24 and $25 in established buildings is extremely attractive. College Park rents are in the mid-$20's with 5-year leases and that gives us a decided market edge.

For the upcoming months NBP is focusing its leasing energies on 400 College Road East, recently occupied in its entirety by a global financial information services company which invested mightily in state- of- the art- appointments until it outgrew its space. Among the multi-million dollar upgrades included in the 72,000-square-foot building are full backup power systems, raised floors and a modern employee cafeteria.

400 College Road East is a once-in-a lifetime opportunity for a firm requiring sophisticated high-tech facilities along Route 1. This is only the second time the buildings has been available since it's construction in the early 80's.

Going forward, with an eye on the growing biotech industry, National Business Parks and its parent, Lawrence Zirinsky Associates have fully-approved plans in hand to develop two new complexes aimed largely at this market.

These are College Park 2, an office/research center, where site work for the first building is just underway. Ultimate development plans for this complex calls for five buildings totaling 345,000 s/f which will be developed on a 31-acre site.

The second center, College Park 3 is a 4-building premier corporate office park to be built on a 47-acre site. Both complexes are being developed on a build-to-suit basis.

* National Business Parks is the manageing arm of Lawrence Zirinsky Associates, owners of College Park at Princeton Forrestal Center.

BY VINCENT MARANO, COO

NATIONAL BUSINESS PARKS