rew-online.com
Original Article
A rare infusion of new Class A office space is coming soon to downtown Morristown, as a developer prepares to begin a project that will deliver about 50,000 square feet to the central business district.
Located at 21 South St., the long-awaited construction by Prism Capital Partners could begin as soon as the spring, executives with the firm say. Plans call for rehabilitating and adding two floors to an existing corner building, resulting in a new high-end office property.
The project is a joint venture with The Hampshire Cos. and Gramercy Property Trust, having generated significant interest in recent years as Prism worked to secure local entitlements. With approvals now in place, the firm is poised to tap into the demand in downtown Morristown.
“We now know we can deliver in 14 to 15 months,” said Eugene Diaz, principal partner with Prism Capital Partners. “We should have fully completed additional space, a renovated exterior and a new lobby in a market that is crying for high-quality office space.”
A report last fall by Newmark Knight Frank found that downtown Morristown contains 2.2 million square feet of office space, with an availability rate of 8.8 percent. But the firm also noted that nearly 80 percent of the office space was developed in the 1980s or earlier.
At the time of the report, NKF found that there was just one block of Class A or B space of more than 20,000 square feet available in the downtown.
The lack of options was especially evident in recent years when law firm Fox Rothschild LLP was seeking new space downtown and ultimately opted for a built-to-suit, 42,000-square-foot building at 49 Market St. The property was developed by Hampshire, which is headquartered nearby, and required demolition of several buildings and a subsequent redevelopment.
At 21 South St., Prism is starting with an existing building that has a Wells Fargo bank branch on the ground floor and three floors of office space above. The firm has said in the past that the rehabilitation and expansion amounts to a somewhat complex project, but the interest in the space is more than enough to validate the effort.
“It’s all across the board, anything from law firms to financial companies, professional services, technology,” said Edwin Cohen, also a principal partner with Prism. “It’s a tremendous level of inquiries.”
Diaz noted that the revitalization of downtown Morristown was a long time coming, but the activity over the past decade has reflected a winning formula that other towns could replicate.
“Morristown is proof that you create a dynamic mixed-use environment and your office product will thrive,” Diaz said. “Morristown rents have never been higher and they’re now some of the highest in the state. What did they do? They added people who could live downtown, they built condominiums and apartments, there’s bars and restaurants and shops and stores — all combined with some public transportation.”