Vacancy rates in Schaumburg are continuing to drop, a positive sign for the local economy, but have not fully recovered to pre-recession levels.
Vacancy rates for the three major commercial sectors in Schaumburg — office, industrial and retail — peaked in 2009, but have been slowly dropping ever since. However, none of the three groups have made it back to pre-recession levels. In 2007, the industrial vacancy rate was at 8.4 percent before peaking at 11.8 and was at 9.7 in 2011; office was at 17.3, rose to 24.3 and has since dropped to 19.6; retail was at 7.7, climbed to 10.9 and is now at 8.8.
“We are doing very well in commercial retail and certainly, our industrial sector is holding steady,” said Matt Frank, the village’s assistant director of community development.
Schaumburg officials and local business leaders have been trying to address the vacancy rates since last February, when the village and the Schaumburg Business Association established the Center for Economic Development, which promotes Schaumburg to outside merchants and tries to retain current employers and businesses.
Since then, the partnership worked with Italian automotive parts manufacturer MTA to expand its Schaumburg operations from a 5,000-square-foot facility to a new 30,000-square-foot building on Remington Road near National Parkway.
Jim Feltman, the center’s vice president of economic development, who said he has a personal focus on the industrial sector, also touted the recruitment of Intelligent Thermal Solutions, which specializes in biomedical product transportation. They recently opened up a 4,000-square-foot sales office on Woodfield Road. And Feltman and the center are trying to get them to move manufacturing operations to Schaumburg from the company’s current facilities in Texas.
“They get to come and test the waters, then we talk to them about bringing their manufacturing to Schaumburg,” he said.
In the retail sector, the former 125,000-square-foot Sears Great Outdoors location has been leased and will be filled by the end of 2012. The space will be split between a PGA Tour Shop, which is expected to open in the spring, and an Xsport Fitness, which is slated to be open by late-fall or early-winter.
The largest vacant space, the former 130,000-square-foot Lowe’s location at Schaumburg and Barrington roads is still unoccupied, but officials are continuing to try to find a suitor for the big box space.
Ultimately, improvements in vacancy rates in one area can have a positive impact on other areas. For example, a large company moving to office or industrial will have more employees to eat lunch at local restaurants or shop at Schaumburg stores. A boost in daytime population, which comes with more employers, will attract more retailers and eateries, creating a cyclical boom for the local economy.
“You need that manufacturing to support the retail and sales-based initiatives,” Feltman said.
Schaumburg has both name-recognition and is connected to major expressways, a positive for potential businesses, Frank said. However, there are drawbacks, which Frank said include lease rates that may be higher than other towns trying to bring in the same business. However, he said, the village has not control over lease rates.
One method some municipalities take to offset such costs is to offer some kind of financial incentive to attract businesses. Frank said Schaumburg has historically not taken that route, and there are no current plans to do so.
“We don’t incentivize or subsidize,” he said. “You don’t want to do it for one, then open it up for others,
