I've been concerned since the beginning of this blog, that there is a Commercial Real Estate (CRE) bubble in Bend equal to exceeding the residential bubble. Because it takes a couple of years longer to play out, up until now we've seen building still going on.
An example of the disconnect between real economic conditions and CRE would be the sad spectacle of Gottshalks opening a new store -- with a surrounding complex -- and closing almost immediately.
Downtown, the Oxford Hotel is nearing completion, as is the completion of the outside of the parking garage. All those flaggers and hardhats I see every day on the way to work are going to be looking for something else to do.
The Bulletin article this morning, Empty Stores, points out that we're probably lucky that we didn't have a Circuit City in town, and -- despite the stated desire on the part of one of the commercial leasing agents quoted in the article -- we're lucky that we don't have a Borders. (I just don't believe Borders is going to last the year.)
Anyone who reads this blog knows that I've been calling for one of the news agencies in this town to do the research on retail square footage in Bend. I've tried with my limited web-fu skills to ascertain that figure, but haven't found it.
One of the brokers quoted in the article, Stephen Toomey, of Compass Commercial, says, "You would have to think that Bend is over retailed, but how much I don't know. The market will tell."
This seems disingenuous to me. He should be able at least to compare per capita square footage with other towns in Oregon. With the added caveat that towns like Eugene, for instance, are located on an interstate, have a four-year college (ditto Medford, Corvallis); Salem with it's state capital; and so on, almost every comparable town has more going for it than Bend, and much larger populations within a short distance.
In other words, even per capita wouldn't tell the real story -- because of Bend's isolation.
Still, it would be a start.
My guess is, this information can only be accessed by the CRE industry themselves -- and they have no incentive to tell us.
4 days ago