Question of the Month: How has transactional activity increased in New Hampshire this fall? - by Bill Norton

Bill Norton, Norton Asset Management

Fall has come to New Hampshire and with it, transactional activity has increased. Presumably, the dog days of summer are over and folks are back to work full-time. We have had several sale transactions completed, and one pending. We just listed a 14,000 s/f former law office for sale in Manchester.

On the leasing side, we have 3 not-for-profit and 4 private sector firms looking at their lease options. This involves staying where they are versus moving to other space. Office lease rates are very competitive but the costs of moving are significant, so the math has to be done to see if moving makes financial sense.

We were curious whether the stock market drops in China, and here in the U.S., were going to impact commercial real estate transactions. So far, we have seen no impact, either positive or negative. We will continue to monitor that.

The presidential election is coming up and for New Hampshire, the “first in the nation” state, that often means lots of activity, as well as media and event spending, which can add up to millions of dollars. However, with new technologies it will have less impact on the New Hampshire economy than it used to be. Today, many media outlets are not locally owned, thus profits leave New Hampshire.

Today’s paper announced that Rick Perry and Scott Walker have already dropped out of the Republican presidential primary. However, there are many more candidates still in the race and they will keep coming back to New Hampshire to get national media attention. For those of us who live and work in New Hampshire, this all can be a distraction. It is fun to see these candidates up close and personal (Donald Trump is scary looking live!). Having lived here 30+ years, the candor and one-on-one experiences with the candidates is few and far between these days. When New Hampshire was the fast-growing gazelle of the New England states, there was more energy and attention here, but today with New Hampshire somewhat anemic, there is less interest in our historical “first in the nation” status.

This gradual decline of New Hampshire as the shining star of the Northeast has been a reality for quite a while. As Steve Norton of the New Hampshire Center for Public Policy Studies stated so clearly, “New Hampshire’s tail winds are now head winds.” A key question is what are we going to do about it? An excellent question - what we used to call decades ago the $64 question (and more recently the $64,000 question and which today might be the $6.4 million dollar question). Regardless, we have been resting on our laurels. With extremely high energy costs, an aging population and our recent college graduates locating elsewhere (true? or urban myth?), we need to do something about it now.

So while Governor Maggie Hassan decides whether to run against Senator Kelly Ayotte, several people have indicated their intent to run for governor, among those are Chris Sununu, the son of former Governor John Sununu, State Senator Jeb Bradley and several others. We need for them to champion a state long-range vision. We need a strategy to foster growth - growth in jobs (good jobs - tech jobs, not low-end retail and service jobs). We need to foster small, savvy tech companies of 5, 10 and 20 employees. This is where energy and 21^st century connectedness comes from.

For those of us in commercial real estate, we know that this younger cohort will inflate our anemic economy and thus fill empty space in offices, manufacturing, flex-tech and distribution buildings. This will need to be an ongoing endeavor - a marathon, not a sprint. We have drifted down into this soft economic trough for several years. It will take several years to re-float the ship and get it sailing again.

Bill Norton, CRE, FRM, is president of Norton Asset Management, Manchester, N.H.