Summit County.

• Author: Anker, Tim
• Position: COUNTRY REPORT

Park City's commercial real estate market continues to strengthen with all sectors posting single digit vacancies. Main Street rents continue to break records as national tenants compete with locals for very limited space. New construction remains tempered as higher land and construction costs combined with an arduous entitlement process keep building inventory in check. Perhaps the biggest stranglehold on commercial growth, especially in the office sector, continues to be the drastic lack of affordable housing for those businesses looking to relocate in Park City under build-to-suit scenarios. Several large projects loom over the market that could add significant inventory over the coming years. These projects include the revival of Bonanza Park, Mayflower development, Treasure Hill, Silver Creek Village, Marketplace at Silver Creek Center, and the continued expansion of the Park City Tech Center and Canyons Village. Overall the commercial real estate market in Park City remains very strong as it seeks to accommodate the growth needs of an improving economy.

OFFICE

LEASE RATES PSF $14--$26 NNN

VACANCY 5.2%

CAP RATE 5.75%--6.75%

LAND VALUES PSF $12.00 to $20.00

OFFICE SUMMARY

The Park City office market experienced a slight increase of vacancy from 4.5% to 5.2% mainly due to the relocation of Skullcandy into its new headquarters. This created much-needed Class A inventory at Newpark, however most of this vacancy has already been absorbed. Office requirements over 5,000 square feet require patience and creativity, and in some cases converting traditional retail space into office use. Class A office remains extremely difficult to secure and is spurring build-to-suit projects.

RETAIL

LEASE RATES PSF $18--$100 NNN

VACANCY 1.9%

CAP RATE 5.5%--6.5%

LAND VALUES PSF $12.00 to $28.00

RETAIL SUMMARY

Retail vacancy dropped from 3.6% to a remarkable...