R & R Commercial realty Owner Charlie Rodriguez | PHOTO COURTESY OF R & R COMMERCIAL REALTY
The National Association of Realtors found that the Dover metropolitan area is stable in industrial, retail and office space, per its second quarter report. All three sectors leased more space than was available on the market, with rental rates growing at slow rates.
Industrial real estate has a vacancy rate of 3.5% with a net gain of 270,156 square feet of leased space in the past 12 months, according to the report. For the quarter that ended in June, retail space has a 2.7% vacancy rate and office space has a 7% rate. In the last year, retail has gained 77,289 square feet of leased space and office has gained 289,934 square feet of leased space.
The market rent growth for all three sectors ranged between 1.9 and 8.4%.
For Charlie Rodriguez, owner of R & R Commercial Realty who’s been making deals in Kent County for 23 years, those numbers bear out.
“In Delaware, it’s hard to specialize in one sector, because we’re so small. [R & R] pretty much does everything, but right now we’re handling a lot with warehouse space and retail,” Rodriguez told the Delaware Business Times. “In terms of the demand in [Kent County], you’re seeing a lot happen with lots of sectors. But with warehousing, we’re pretty much full in this market. You’re starting to see some developers buy land for that need.”
Late last year, Dover officials approved a 234,000-square-foot warehouse to be the last warehouse in Enterprise Business Park in western Dover. Another warehouse, the Dover Logistics Center on Lafferty Lane, will hope to lift that market.
But Rodriguez noted that for every demand for large tracts of warehousing, there’s still buyers looking for small flex space.
“We get calls anywhere between 150,000 square feet and small warehouse complexes, which could be to rent 1,200 square feet for a start-up,” he said.
Delaware’s population growth keeps pushing south over the C & D Canal, notably in Sussex County and the Middletown area, but Kent County has grown along Route 13 with retail centers and restaurants. Notable among them was the Capital Station, borne after razing the former Playtex factory that closed in the 1990s.
Right now, R & R sees a lot of action from small, mom and pop stores on the market for leases. There is not a lot of appetite for office space, though Rodriguez noted that with more medical groups headed to Dover and Milford to support Bayhealth’s growth in the area, that may change. Since the county continues to be predominantly rural and not many corporations are within its limits, he added that Kent’s commercial space market may not be as hard hit by hybrid work.
“There’s a lot of restaurants looking to locate in Kent County, and some of the retailers are on hold right now,” Rodriguez said. “Kent County is a good market, it has its ups and downs like anything but that’s like almost anywhere. There’s been a lot of activity.”
