Demand increasing for quality office space
Start-ups of biotech firms and insurance-linked securities operations are fuelling demand for commercial property, real estate firm Coldwell Banker Bermuda Realty said.
And growth in the trust area of international business is also responsible for some growth in commercial sector.
But Susan Thompson, Coldwell Banker Bermuda Realty’s general manager, said the numbers of staff involved were much smaller than the insurance and reinsurance sectors, which traditionally employed large numbers of people.
“These are all small things, but in the past what we’ve generally seen are reinsurance companies,” she said.
“It’s small, where we may have five to ten people, but it’s still people coming on to the island, which is important for our growth.
“There have been a lot of mergers and acquisitions in reinsurance companies, so the spaces merge as well.
“People are consolidating with mergers and acquisitions and there aren’t a lot of reinsurance start-ups.”
Ms Thompson said about 500,000 square feet of vacant office space remains available.
The latest Coldwell Banker market update, the first of the year, said there had been “general movement to quality office space” over the past year.
It added that the majority of demand is in the western part of Hamilton and Pembroke for better quality buildings and spaces that have good natural light, views, are already fitted out and have disabled access.
Clients also want sprinkler systems, energy-efficient LED lighting and air conditioning, as well as gyms and showers on-site.
Coldwell Banker reported that demand focused on 500-4,000 square feet spaces, with some requirements for up to 20,000 square feet.
The sales market update added: “Tenants are shying away from multi-floor operations wherever they can.
“Many landlords are continuing to offer various forms of creative incentives to entice potential occupants to their buildings.”
And it added: “Some owners who have not invested to upgrade the infrastructure in their properties have found it difficult to fill vacant space.”