How Economic Revitalization Zones Work For You

Recently the town of Bedford looked at the Economic Revitalization Zones (ERZ) that are administered by the State of New Hampshire. This year the State’s largest city, Manchester, is looking at their ERZ foot print and seeing if expansion should be in the cards. 

The ERZ is a tax credit program that is administered by the State to help foster growth in areas that are in need of economic assistance. While the program is nothing new, it has been around for years, the word is just getting out. A simple example of how it can work would be that a company moves into a vacant building that is in an ERZ. They spend money to improve the building for their use as well as bring in new hires. 

Based on the improvement amount and the number of jobs created this potential company could get dollar for dollar credits at the state level. Because of the subtle details of the program it is not a linear function. Anyone who has a potential project should contact the Department of Resources and Economic Development to really understand if the project qualifies as well as the savings potential. This raises the important issue that the ERZs are lot specific. Just because you and your neighbor share the same zone as it relates to the town (Commercial, Industrial, Performance) does not mean you both share the same as it relates to ERZ. Only the state can verify if your lot is within a zone. 

As the City of Manchester looks to expand its use of the ERZ other towns and cities throughout the state may as well. It is a great tool as business owners look to expand and grow their businesses.

MENDOLA OF NAI NORWOOD GROUP BROKERS SELF STORAGE FACILITY FOR $11.1 MILLION

Joseph Mendola, SVP of NAI Norwood Group in Bedford NH, has brokered the sale of 495 Storage at 545 Clark Road in Tewksbury, MA. NAI Norwood Group represented the sellers, 495 Storage, LLC in this transaction and assisted the buyer. The purchase price is $11.1 million. Mendola is the Argus Self Storage National Sales Network representative for the Northern New England region. Argus is a national sales network of brokers who specialize in the brokerage of self-storage facilities. There are Argus brokers in the 40 major real estate markets in the country. Argus is the largest listing organization of self- storage facilities in the country.

The sellers built a state of the art 90,000+/- SF climate controlled facility on three floors. The property has good visibility to I-495 at the Route 38 exit in Tewksbury, MA. It is also strategically located across from a community shopping center with Market Basket as an anchor tenant.

This acquisition of 495 Storage fits nicely into the buyer's plan to increase its presence in the New England self-storage market. 495 Storage is the fifth acquisition in the Greater Boston Market. Other acquisitions include facilities in Brighton, Boston, Stoneham and Medford Massachusetts. It also has facilities under management in Southern New Hampshire.

The self-storage industry has evolved over the last 20 years in New England into a service that is in high demand. This makes the self-storage asset a first class investment in real estate. The self-storage REITS produced the highest return on capital in 2013 compared to the other real estate REITS in the US.

This investment has gone from a question of are month to month rental contracts good collateral for a loan to an investment that is commanding ever higher purchase prices in the marketplace. This is partly due to the demographic shift that is taking place in the country today. There are 2 dynamics that are in play today that create a perfect storm for increased demand for well-located quality self-storage facilities. These 2 dynamics that are taking place today is the behavior of both the “Baby Boomers” and Generation “Y”.

The “Baby Boomers” are downsizing from their large colonial type homes to smaller housing in retirement. This is compounded by the fact that the Boomers’ children are taking longer to form their own families. This means Mom and Dad have to hold onto more stuff. The second dynamic is that Generation “Y”; the 20 to 35 year olds are not viewing the American Dream as being move to the suburbs and buy a house to start building their net worth. These people witnessed Mom and Dad either losing their home in the financial meltdown, having their parents’ home be “under water” with their mortgage balance, or just unable to sell their home due to lack of equity built up in it. So owning a single family home with plenty of storage space is not as appealing was it was in the Boomers generation. Either way these dynamics support the thesis of continued increased demand for quality run self-storage facilities in the future.

NAI Norwood Group is an affiliate of NAI Global, the world’s leading managed network of independently owned commercial real estate brokerage firms. Through this network of 355 offices in 55 countries, NAI Norwood Group is able to leverage their 45+ years of dedicated local experience around the world. With our extensive background and strong local contacts, we are able to assist individual corporations in negotiating leases, sales, business brokerage, investments, relocation, site selection and development. For more information please visit www.nainorwoodgroup.com. Or contact one of our offices: 116 South River Road, Bedford, NH 03110, (603) 668-7000 or 28 Deer Street Suite 301, Portsmouth, NH 03801 (603) 431-3001.