Xceligent Reports Reveal Mixed Results in Markets

Xceligent Inc., the Independence, Mo.-based online real estate data company, has released its Northwest Arkansas market reports from the fourth quarter of 2011.

The reports covered the office, retail and industrial segments. Production of the reports is overseen by regional director Jordan Ligon, who works out of Xceligent’s Fayetteville office.

The company’s parameters exclude owner-occupied properties over 30,000 SF and buildings under 10,000 SF.

By those guidelines, the office space sector showed 39,000 SF of positive absorption for the quarter among Class A properties.

For the entire year, space in west Rogers (41,418 SF) and north Fayetteville (33,568 SF) had the largest positive absorption.

One notable transaction was the move made by Foxwood Sports/Crestwood Associates from a 14,722-SF space at 3900 N. Front St. to a 15,254-SF space in the Commerce Park II development at 2409 E. Joyce Blvd. Both locations are in Fayetteville.

Butch Gurganus, a principal at Colliers International in Bentonville, said landlords still have problems being overleveraged with properties, but as far as leasing activity goes, “we have hit bottom and are turning the corner coming back up.

“The feedback is that there are a lot of tours going on,” he added. “I am showing a lot of people around and I am getting calls from other brokers who are showing people around. There’s just a lot of activity going on.”

Gurganus also said tenants are entering into more long-term lease agreements, in the three- to five-year range.

“Two years ago,” he said, “I bet 80 percent of the leases I did were one-year deals.”

In retail space, Xceligent reports total net absorption of more than 117,000 SF for the quarter. Rogers’ west side led the area for the year with than 99,000 SF of positive absorption.

The report noted that all property types experienced positive absorption for the quarter except for power centers, such as the Pinnacle Hills Promenade, which showed no change.

Ozark Center Point, at Interstate 540 and U.S. 412 in Springdale, led area shopping centers in the amount of space leased in the quarter.

Christian Book Outlet opened a new store there, leasing 4,500 SF, and longtime tenant Back at the Ranch signed a lease for 7,350 SF.

The news in the industrial market wasn’t as positive. Pat Morrison, principal broker-owner at Morrison Wanger Adams in Rogers, called 2011 “a dark year” for industrial activity.

“We were in the deep end of the pool, and I think you’ll see that was the case in other areas, like Fort Smith, and nationwide, too,” Morrison said. “But we’re looking at coming out of that in 2012, I think.”

According to the Xceligent report, the total net absorption rate in the industrial sector for 2011 was about -295,000 SF. The most promising activity, for the fourth quarter and entire year, was in east Springdale and east Rogers.

Part of the discrepancy between the activity in industrial and the office and retail segments was pent-up demand in the latter, Morrison said.

“That’s probably why office and retail seem to be coming back a little quicker. The job market has to start coming back, too. I think that’s why the industrial side of things has been lagging a little bit behind.”

Some notable transactions in the industrial segment included Harps Food Stores leasing 75,000 SF of warehouse and distribution space, Sift Clean purchasing 30,000 SF of light industrial space, and JWT Properties LLC purchasing 25,000 SF of light industrial space, all in Springdale.

Those transactions showed why activity in Springdale typically is a good indicator of what’s happening in the market, Morrison said.

“Watch Springdale,” he said. “Springdale is always going to have the most activity because it has the most industrial and warehouse buildings in the area.”

Morrison said he also sees room for increased activity near Wal-Mart Stores Inc.’s distribution center in Bentonville, and near Northwest Arkansas Regional Airport.