COVER STORY

David Mullen, deputy director and economic development director of the Pease Development Authority. Amy Root-Donle

The residential market may have been soft heading into early 2007, but the commercial market was another story altogether. There is no correlation between the sales pace of housing and business properties, Seacoast experts remind us.

"We have never been busier," said David Choate of Grubb & Ellis Coldstream Realtors. "People are feeling good about the economy."

The state of things provides some good investment opportunities. Some trends show a number of businesses seeking leasing options as others seek ownership for equity appreciation and tax benefits, according to Choate.

Buyers are still as analytical as ever in the process. "At some point people say enough is enough -- they just won't pay certain prices," he said.

Office condos remain hot, said Choate, citing the new Great Bay Commons his agency has in Newington. Contractors are also seeking out industrial condos and shop space, he said.

Similar lease arrangements at Pease International Tradeport continue to field numerous inquiries, according to David Mullen, deputy director and economic development director at Pease. Like the Great Bay Commons, Pease has a number of sites that can be customized to meet a company's needs. One such location at Pease was the former Flextronics space.

David Choate at Grubb & Ellis Coldstream Realtors. Amy Root-Donle

Choate is also encouraged by activity at Pease International Tradeport. His agency recently leased three of four vacant spaces at Pease, when they had been vacant for six months.

What is a good investment?

The basics, Choate notes, is a property that provides good cash flow, stable tenants, and room for appreciation. Often, he adds, there is not a lot of margin for error.

Fred Attalla, a licensed broker in Maine, New Hampshire and Massachusetts for Points Nor'East Properties, sees tremendous potential in the Seacoast market. "This is going to be the Manchester triangle," he said, referring to the Nashua-Manchester-Salem region that saw such spectacular growth in the 1970s and 1980s.

Attalla said people are still looking for good retail space and mixed-use space as investments, though prices have not softened up any in downtown Portsmouth. He, too, sees a number of condominium conversions for office use.

"Mixed-use buildings are a good bet," he said.

Attalla calls Pease the engine that drives the Seacoast economy because it is within easy reach of Manchester, northeastern Massachusetts and points in Maine. The proximity to the University of New Hampshire and other colleges, some with satellite campuses at the business areas in Portsmouth and Newington, is another benefit, he said.

Mullen said location remains one of Pease's biggest selling points. Companies at Pease can draw their labor force from as far away as Boston and Portland, he said.

"There's a lot of activity in the marketplace," Mullen said.

Where the residential market took a blow over the past year, the commercial and office market thrived thanks to small business strength, diversity, entrepreneurship, and e-Coast upstarts, according to Attalla.

"I look at it as a market of correction," he said of the market as a whole.