Tim Bradley, CCIM Jackson Wyoming Commercial Real Estate

After years of annual 15% to 25% increases, Jackson Hole office prices have plateaued and are even showing decreases. The drops are attributable to three factors.

Tighter Credit
Mortgage rates haven't gone up, a typical cause of decreased values, but credit is harder to come by. As a result, fewer buyers are qualified to purchase office property, putting downward pressure on prices. Lenders are demanding a higher debt coverage ratio, causing lower loan to value ratios, and pushing more buyers out of the pool.

Building Glut Leads to Oversupply
New office buildings at 690 South Highway 89, 172 Center Street, and 10/20 Pioneer Lane will add over 15,000 square feet of office space to the market in the next six months. This comes on top of the recently completed building at 275 Veronica Lane which still has 3,300 square feet available. In all, I estimate there is over 47,000 square feet of available or soon to be completed office space in Jackson. I can't recall a time when there was more than 5,000 or 6,000 square feet available. In addition, we are receiving a steady stream of phone calls from office tenants who would like to downsize, or are seeking subtenants to take over vacant space within their offices, which leads us to...

Cutbacks Reduce Demand
The recession has caused quite a few local firms to downsize. The construction/real estate industry has been hit the hardest, with contractors, engineers, architects, real estate companies, and title companies all laying off employees. Some have closed their doors, while others are trying to sublease empty offices or have taken advantage of lease endings and have moved to smaller quarters.

So What
These factors have reduced demand for office space, and prices are beginning to fall as a result. Landlords may be looking at extended vacancies, as it may take several years to absorb the existing office space in town. This will create opportunity for the stronger tenants in town, as they will be able to use their leverage to negotiate lower leases. It also creates opportunity for the well capitalized investor, who may be able to acquire some excellent property in Jackson that has long been rather expensive.

Tim Bradley is an owner of Contour Investment Properties, the only brokerage firm in Jackson exclusively focused on commercial and investment property in Jackson Hole and Teton Valley. Tim has earned the MAI designation from the Appraisal Institute as well as the CCIM designation from the CCIM Institute.

Tim Bradley
Owner/Broker
Contour Investment Properties
220 East Broadway
PO Box 1152
Jackson, WY 83001
(307) 733-6400
www.contourproperties.com

Took this from my back deck. Just liked the way the light and clouds made a halo over Snow King Mountain in Jackson, WY. The effect only lasted about 5 minutes and I've never seen it happen again. The streak on the right is a jet contrail. Picture taken in April 2004.

Hello all,

At Contour Properties, we have over 20 listings of investment property in Jackson Hole, Wyoming. Our listings include retail shops, office buildings, land for development, and light industrial opportunities. You may not know that Teton County, home to Jackson Hole, consistently ranks in the top three wealthiest counties in the United States, according to the Internal Revenue Service. That wealth ensures a stability in our market unmatched by too many other markets.

For information on investing in Jackson Hole, call or come visit us while on vacation. It's no mystery why so many people want to live and invest here - it's just that gorgeous. Jackson is the southern gateway to Yellowstone National Park and is in the heart of Grand Teton National Park. Unparalleled skiiing, white water rafting, outdoor adventuring.....and all in a state with no personal or corporate income tax!

We're the local experts, and we'd be glad to show you around. See you on the slopes this winter!