Michael Williams, vice president of Karnes Research Company in Raleigh, said Orange County's office space vacancy rate in 2000 was a tight 0.8 percent, which has now spiked to more than 30 percent.
"(The high vacancy rate) has a lot to do with all the development at Meadowmont," Williams said. "But, it's a common occurrence where developers build speculative office space. In the past it's always been high rents and tight vacancies."
Meadowmont, a 435-acre mixed-use development located on the north side of N.C. 54 across from the Friday Center, broke ground in May 1999 under the direction of Roger Perry at East West Partners.
The project took almost nine years of planning and working with the Chapel Hill Town Council to approve what resulted in the largest private development in the town's history.
But of the 100,000 square feet of office space available at Meadowmont, only about 20,000 square feet has been leased so far, leaving the development with an 80 percent vacancy rate.
Jim Lepley, vice president of leasing at Craig Davis Properties, which manages the leasing of Meadowmont space, said despite the high vacancy rate now, he expects to attract more office tenants once the development is completed.
"Meadowmont is so well positioned with office, retail and residential space that I think it will be very successful in the future," Lepley said.
"We're very optimistic that once our restaurants open in the spring we will lure more office tenants. There's a lot that's happening (at Meadowmont) in the next several months," he said.
Lepley said he attributes the high vacancy rate at Meadowmont to the general economic slowdown of the area.
