Airbase propels Dayton office market
By Richard Meder, Colliers
While office markets across the country have seen a slow return to normal following COVID-19 restrictions, the Dayton office market has found strength in Wright-Patterson Air Force Base (WPAFB) .
Although the Dayton office market around WPAFB has seen similar ebbs and flows to the rest of the country during the pandemic, business has never stopped. For some in other markets, the lasting effects of this office market disruption remain unknown.
Business leaders must decide whether they want to implement a remote working lifestyle into their employee plan or make an effort to return to normal office life – for some companies this is a a hybrid approach. For tenants in the WPAFB submarket, however, there was never a question.
While many office tenants vacated their spaces out of uncertainty, defense contractors cautiously occupying office space in the WPAFB submarket have almost single-handedly helped Dayton stay on its feet during the pandemic. With the sub-market being almost entirely made up of defense contractors, this type of defense contracting work was not allowed to stop with the rest of the world.
Having to adhere to local and federal guidelines, decision-making among defense contractors has certainly slowed down, but it never stopped.
Dayton’s market stability can be partly attributed to the type of work performed by defense contractors at the base. Historically, WPAFB has been very logistics-oriented. While those roots remain, there has been a growing presence of intelligence-based programs funded out of Washington, D.C. new and emerging.
As one of the largest employers in the Dayton area, this transition into the work of defense contractors is also driving a transition into the labor market. Leaders and managers working around WPAFB seem to be hiring more aggressively than has always been the norm. What interests these recruiters the most is talent, skills, intelligence and ingenuity.
However, this shift to a more intelligence-based user cannot be attributed solely to the grassroots. In January, Intel announced the investment of more than $20 billion to build two new facilities near Columbus. This move is expected to positively affect the Dayton office market through two major factors: proximity and affordability.
Businesses have begun to realize that Dayton is only an hour and a half from Columbus and is already home to a state-of-the-art workforce, thanks to WPAFB. Business leaders are beginning to see Dayton as a strong contender for their regional and national headquarters. While the Intel deal is expected to affect the entire state of Ohio, the Dayton market is likely to see a bigger impact due to what WPAFB already offers the region.
The other determining factor in Dayton and WPAFB market stability is the affordability of the region. With inflation rates soaring across the country, it’s hard to ignore the effect Dayton’s more reasonable cost of living has had on the office market.
People from the West Coast and Silicon Valley find the Midwest lifestyle more appropriate and affordable than what they experienced on the West Coast. Those who do defense work in Dayton find themselves wanting to stay in Dayton and establish their own roots.
Cities around the base – Dayton being the driving force – have already begun to recognize the strength of the base’s economic benefits. The Dayton office market will continue to be bright going forward. Dayton has positioned itself well to take advantage of WPAFB-centric technology growth.
Richard Meder is senior vice president at Colliers Cincinnati. This article originally appeared in the July 2022 issue of Heartland Real Estate Business magazine.