Low real estate prices and a central location make Evansville an attractive option for businesses considering an expansion or relocation, according to Dannetta Hiatt of F.C. Tucker Emge.
But, a lack of suitable large-scale industrial space is forcing many of those firms to go elsewhere, Hiatt said during the annual "State of Real Estate Report," presented Thursday at the Executive Inn.
Hiatt and other representatives from F.C. Tucker Emge reviewed notable real estate developments from 2005 and offered forecasts for the coming year in the office, industrial, retail and residential markets.
"2005 has been a race for space in the industrial market," Hiatt said. "Spec buildings over 200,000-square-feet are non-existent and are needed today."
For the second year in a row, Hiatt noted a lack of supply in the industrial real estate market. Hiatt said the need for large warehouses is high, but the supply in the Evansville area cannot keep up.
Hiatt said industrial space in Evansville is generally less expensive than other markets, and companies looking to relocate are noticing the potential savings. But, the firms are often limited by the options available in the area.
"We could have had more corporations move to Evansville if we had the space," said Kevin Eastridge, chief executive officer of Tucker Emge. "We need this space. The industrial market is strong."
Hiatt forecast the market would move to meet the demand for large industrial space with the construction of "big box" warehouses and other developments in the coming year.
Representatives from the real estate company also predicted big growth in other markets, with much activity taking place on the East Side.
"Contrary to Horace Greeley's advice, I would say 'Go northeast young man,'" said Drew Platt in his review of rising land values in Northeastern Vanderburgh County and Warrick County.
Platt identified two "supergrowth" areas centered at the corner of Lynch and Green River roads and at Epworth Road and the Lloyd Expressway in Warrick County. Infrastructure improvements and growing residential developments are pushing commercial growth at both locations, he said.
Ken Newcomb Jr., president of F.C. Tucker Commercial, said that while the rest of the country is beginning to show signs of slowing retail growth, that's "not the case in our area."
The East Side Wal-Mart store at the corner of Burkhardt and the Lloyd was among the top five Wal-Mart stores nationwide in terms of sales per square foot, while the nearby Sam's Club ranked in the top 10, Newcomb said.
"Last time I checked, we weren't in the top 10 in terms of metro population," Eastridge said.
Newcomb expects to see continued retail expansion on Burkhardt Road and along Epworth, with new restaurant activity showing notable strength. He also predicted changes at some shopping centers as large buildings that have remained vacant for some time are demolished.
"There is no demand," for those spaces, Newcomb said. "The ground value is going to be higher than the building value, so the building becomes a detriment."
After posting record high home sales and price levels in 2005, the firm expects a sixth consecutive record year for the residential market in 2006, despite rising interest rates.
"Just the sheer growth in population will mean more growth in the residential market," Eastridge said.
