Thoughts about business and economic development in rural areas.

 

December 2007
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Archive for December 29th, 2007

To spec or not to spec!

Every community and economic development group has had the ‘spec building’ discussion. Should we or shouldn’t we. If we do, what do we build? Unfortunately most groups stop right there and never get past the discussion stage. I should know because I’ve set in on several of those conversations. In fact, I even started a few of them. So what should we be doing?

Step One: Do a complete assessment of currently existing space that is suitable for different development purposes. If there are several existing structures that are ‘really available’ and immediately ready for use by the type of client you are targeting and that will not cost a fortune to redevelop then the answer is simple. You don’t need another building sitting around gathering dust and eating up interest money.

A word of caution here. I used the phrase ‘really available’ and that needs some clarification. If the current owner doesn’t have a solid selling price or if they say, ‘We’ll negotiate a fair price when the right buyer comes along’ then cross that building off your list as a substitute for a real spec building. It’s not really for sale and you don’t want your client to feel like they’re being jerked around……and they will be.

And ‘immediate’ means ‘immediate’. If the building is currently being used for ‘temporary’ storage or has any existing tenant then from the client’s point of view it’s not ‘really available.’ The ‘we can have it cleared out in a couple of weeks’ line won’t work so don’t even try it. Besides, the client is looking at five other buildings that are completely empty and from his perspective, your building won’t even be in the running.

Don’t get me wrong, these exisiting buildings should still be listed on your website and be part of your marketing efforts but NEVER let them stand in your way as you decide if you want to build a real spec building.

Just because there is some existing available space doesn’t mean you don’t need a spec building!