Salem Exit 2 area booming
By BENJAMIN KEPPLE
Union Leader Staff
Monday, Jun. 12, 2006
SALEM ? When drivers leave the I-93 highway at Exit 2, one of the first sights they see upon exiting is the impressive structure of a four-story office building being built along Pelham Road.
It is perhaps the most visible sign of a building boom in the area, which has several structures now under construction or planned to be built, many of which are destined to become medical offices.
There's so much work being done that some town officials say the last time they saw this level of construction activity was during the heyday of the 1980s.
"It's very, very high compared to previous years; certainly, there's a lot of activity," said Ross Moldoff, Salem's planning director. "There's a lot going on and it's come up over the past year or two."
Projects presently being built or planned include a four-story, 65,400-square-foot office building at 25 Pelham Road; two 36,000-square-foot medical office buildings, at 11 and 23 Keewaydin Drive; and a 30,000-square-foot office building at 29 Stiles Road. Elsewhere in Salem, a retail plaza with nearly 62,000 square feet of space is being built on North Broadway.
The Exit 2 area offers plenty of attractions for businesses.
"It's right on the Massachusetts border, virtually. It's right next to I-93. There are great tax benefits to doing business up here. It's just the right environment at the right time," said Nanci Carney, who chairs the board of directors of the Greater Salem Chamber of Commerce.
Construction is booming around I-93's Exit 2 in Salem, such as at this four-story, 65,400-square-foot office building at 25 Pelham Road. (BENJAMIN KEPPLE)
It's also a friendly location for air travelers, Carney said. Those heading to international locations can get on the freeway and head to Logan International Airport in Boston, and domestic travelers can reach Manchester-Boston Regional Airport in as little as 15 minutes, Carney said.
"We're seeing a lot of companies move into that area," she said.
Synchronized Manufacturing Technologies, which is located at 19 Keewaydin Drive and is right near Exit 2, is one such company which found the location perfect for its needs.
"It's really very convenient for us. We looked at Methuen and Salem (Mass.) and Lawrence, but we just thought we would do better in southern New Hampshire," said Alan Kule, Sychronized Manufacturing's president.
According to Kule, the Exit 2 location offers his 20-employee firm several advantages. Taxes are lower, health insurance and business insurance is cheaper, and it's easy to attract employees and customers from both the Route 128 belt in Massachusetts and Manchester and Concord to the north.
Developers see things the same way.
"Obviously, being across the border is a significant and a real advantage. New Hampshire does have a business advantage and there's just no ifs, ands or buts about it," said Chris Goodnow, owner of Goodnow Real Estate Services, a real estate marketing firm.
Goodnow is marketing the 30,000 square feet planned at 29 Stiles Road. Construction is scheduled to begin this week on the building, the first of two. Salem-based Park Place Realty Trust is the owner behind the project.
According to Goodnow, the developers plan to market the 29 Stiles Road building as office condos to physicians and others in the medical field, available for sale or lease. Most of the interest in the building has come from prospective condo buyers, he said.
Selling the space, as opposed to leasing it, offers advantages for the developers as well as the buyers. Interest rates have made it attractive to buy office condo space, and Goodnow said that, generally speaking, the market for buying office space has been quite strong in southern New Hampshire. The leasing market has been somewhat weaker.
Some, however, wonder about all the development taking place. Along Stiles Road, there are several signs advertising available office space, and that has prompted surprise among some that new work would take place nearby.
"You still see a lot of 'vacant' and 'space available' signs, so you kind of scratch your head," Kule said.
However, others point out that the spaces being advertised are generally for smaller blocks of office space, in buildings which are pretty full. Plus, they're different types of buildings than the new construction being built.
"What there are not a lot of are larger blocks of office space. They've been absorbed," Goodnow said. "I think there's clearly some opportunities."
Joe Friedman, president of Brooks Properties, said demand for medical office space in the area is strong. His company is building the two medical office buildings along Keewaydin Drive: one is already under construction. The offices will be available for sale or lease.
Friedman said the population of doctors in the area has increased, and that physicians are willing to update their facilities and move to a new facility in a new location. His company is in the process of talking with tenants, he said.
"There's a lot of demand for medical office space at Exit 2, and we're responding to that demand," said Friedman.
"We're very optimistic about the market."