Indianapolis.

• Author: Croker, Laura
• Position: Real Estate Around the State

INDIANAPOLIS

Slow, sluggish, inactive, idle-no, not just words to describe the progress of the Circle Centre Mall project, but words to describe the Indianapolis commercial real-estate market as a whole.

The downtown office vacancy rates declined slightly from 23.4 percent at the end of the first quarter to 21.5 percent at the end of the second quarter. But when the new state office building opens in summer 1991, tenants will vacate as much as 500,000 square feet of existing space, which will increase the downtown rate again, projects David W. Goodrich, president of the commercial and industrial real-estate division of F.C. Tucker Company, Inc.

According to Goodrich, the picture is slightly different in suburbia. Suburban office vacancy rates declined slightly less, from 23 percent at the end of the first quarter to 22 percent at the end of June. What Goodrich thinks accounts for the difference is greater construction activity in the outlying districts of the city.

The industrial segment of the real estate market, however, has been "a bright spot in the brokerage business so far this year," says Goodrich. "There continues to be quite good demand, particularly for larger buildings, and there is a shortage of large bulk distribution space in the city," he says.

Despite the high demand and low vacancy rates in the industrial segment, developers are not getting the funding they need to supply more industrial space, much less commercial space. "It's a lot harder for developers to get money these days than a few years ago," says Mike McKenna, vice president of Coldwell Banker. Goodrich agrees. "I think that the real estate lending window has been closed...