Montgomery County officials are concerned that a massive stock of empty buildings in Northern Virginia will hurt their efforts to lure big business when increasing numbers of companies are looking to rent instead of build. “They have so many vacant buildings from Arlington to Dulles that they will be able to offer better rents than landlords in Montgomery County,” said Department of Economic Development Director Steve Silverman during an economic briefing with county officials Monday. “It’s a very big deal. In Northern Virginia, they boom and they bust, but it leaves us at a competitive disadvantage with a lack of space.”
MontCo’s top 20 private employers
| 1. Adventist Health |
| 2. Lockheed Martin |
| 3. Kaiser Foundation Health Plan |
| 4. Marriott |
| 5. CVS |
| 6. Capital One/Chevy Chase Bank |
| 7. Giant Food |
| 8. Suburban Hospital |
| 9. Verizon |
| 10. Whole Foods Market |
| 11. Administaff Companies |
| 12. Holy Cross Hospital |
| 13. Costco Wholesale |
| 14. Darcars of Rockville |
| 15. Westat Research |
| 16. Geico |
| 17. Nordstrom |
| 18. MedImmune |
| 19. Affiliated Associates Inc. |
| 20. IBM |
| Source: Montgomery County Department of Economic Development |
Like jurisdictions nationwide, the affluent Maryland suburb has struggled recently to attract major developers.
The county has lost 27,820 jobs since the second quarter of 2006, driven largely by the “complete tanking of the construction industry,” Silverman said. Just 28 of the county’s top 200 employers have hired more than 100 people since the third quarter of 2009.
“There is a history of speculative investment in Northern Virginia and a lack of it in Montgomery County,” said Councilwoman Nancy Floreen, D-at large. “I’d like to know why.”
Silverman pointed to pro-business leaders and the lack of a local income tax in Virginia jurisdictions, which forced officials there to focus on commercial sources to fill county coffers.
For example, Fairfax County has twice as much hotel space as Montgomery, allowing the jurisdiction to charge a 4 percent lodging tax instead of the 7 percent charged in the Maryland suburb.
But some say they prefer the competitive disadvantage to a plethora of vacant space.
“It’s a mixed blessing; the fact that we don’t have a ton of vacant space is a good thing,” said Councilman Marc Elrich, D-at large. “They’ll be able to offer lower prices because some rent is certainly better than no rent. But I don’t want to trade places with them.”
Still, Montgomery isn’t lacking for empty space of its own, with an office vacancy rate of 13 percent — higher than ever before, according to county records.
Fairfax officials say the lower rent, coupled with favorable tax rates, will continue to widen the gap between the region’s two largest jurisdictions in attracting businesses.
“If you’ve got inventory, you have two things — availability and low rates,” said Supervisor Pat Herrity, R-Springfield. “That’s definitely an advantage.”
