Commercial real estate growth in the Tri-Cities continues to mirror the region’s robust residential housing growth.
“The market is hot,” said Vicki Monteagudo, a broker and principal with NAI Tri-Cities Commercial in Richland.
Key growth areas in the Tri-Cities for commercial real estate include the areas of Road 68, Road 100, Richland’s Queensgate Drive area and Kennewick’s Southridge area, said Todd Sternfeld, a broker and principal partner with NAI Tri-Cities Commercial.
Sternfeld and Monteagudo pointed to a few recent commercial property sales that underscore the reason for their positive outlook for the market, as well as their company’s hold on 49 percent of the Tri-Cities’ commercial real estate market share based on percentage of property sold.
That’s according to July 1 to Dec. 27, 2017, figures from Multiple Listings Services. The median price for NAI Tri-Cities Commercial’s sales during this period was $2 million.
The real estate business recently sold the vacant Staples store at 1480 Tapteal Drive in Richland for $2.5 million to Standard Paint and Flooring.
Staples closed in June 2016 when the office supply chain shuttered several stores nationwide.
The family-owned Standard Paint and Flooring said the 24,000-square-foot building will include a showroom with a full design center. It’s expected to open later this year.
The current 9,500-square-foot store at 360 Kellogg St. in Kennewick will remain open until renovations at the new building are complete. It’s been located there for more than five years but was in Richland before that for many years. The company owns the building and it will be either rented or sold.
There are currently 17 employees but moving to the new store will mean the addition of four to six new employees.
The store offers paint, flooring and design, window coverings, concrete polishing and stucco.
“We are really excited about this new building. We have been looking for a bigger location for a while now. We never thought that we would have out grown our current building so fast, but we desperately need more space. This new location will help us continue to grow and service more of our great customers in the Tri-Cities,” said Regan Myers, one of the owners of Standard Paint and Flooring, in a statement.
Other recent NAI Tri-Cities Commercial sales include several properties under contract: a 9,817-square-foot retail center at 3617 Plaza Way in the Southridge area of Kennewick, which sold for $3.3 million; 160,526-square-foot multi-story office building at 1100 and 1200 Jadwin Ave. in Richland, which sold for $2 million; City Church’s 23,892-square-foot building at 4624 W. 10th Ave. in Kennewick, which sold for $3 million.
Sternfeld said he couldn’t talk about the specific plans for the properties until the sales are final.
Sternfeld and Monteagudo recently joined forces this summer to form NAI Group LLC. Monteagudo, owner of Century 21 Tri-Cities, and Sternfeld, a longtime commercial real estate broker, who has been with NAI Tri-Cities for about five years, began discussing a partnership in spring 2017.
They inked the deal to make it official in July to form NAI Group LLC, which bought out the former NAI Tri-Cities partnership.
Monteagudo said she thought it was important to align with NAI as her firm’s expertise focused on the residential market, not commercial.
The new company also includes commercial brokers Derrick Stricker, Kevin O’Rorke and Jazmine Murillo, with a new broker expected to join the team soon.
NAI Tri-Cities is part of a Northwest consortium of NAI firms which meet regularly to share clients and information since they all work with national franchises.
Sternfeld said the new company’s growth has already outpaced his expectations because he didn’t expect to have a team of five until the end of this year.
As the commercial-focused firm looks ahead to 2018, it anticipates continued commercial success in the next five years in the Road 100 area, Monteagudo said.
And the gateway to the Road 100 area is the Sandifur Parkway, she said.
A key piece of real estate that could see new tenants in the coming year is the Broadmoor Outlet mall, which was built in 1995.
With the development of Road 100 on the horizon, the mall could reach its heyday yet, Monteagudo said.
But it won’t be without some challenges.
Over the years, the 23-year-old retail center has seen tenants come and go. Gordon Bros. Winery closed its location there last year.
But Sternfeld said he’s optimistic because he’s been talking with the building’s owners about plans to renovate the mall to attract new tenants.
The 11-acre site’s assessed property value totals about $3.6 million, according to Franklin County Assessor’s Office records.
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