NH Ranks 13th In New Economy

"In times of change, changers and learners will have unlimited opportunity, and knowers will be marvelously well equipped to succeed in a world that no longer exists"... one of my favorite quotes...

This article appeared in the NH Business Review and so is slanted to the NH results, but it should be noted that MA came in #1 in this analysis.

We can get so caught up in the never ending media barrage and the stock market woes. But we must persevere and proceeded! In my effort to never go blue sky, but continue to look for opportunities for myself and my clients, I think this puts a thoughtful look.

I have many clients and associates who are thriving, growing, changing, evolving... and so it goes!

I have the full report, The 2008 State New Economy Index, available to send you- all you need to do is reply to this blog and ask... BF



N.H. ranks 13th in ‘New Economy’

Friday, November 21, 2008

A new report has placed New Hampshire among the top states in the country in adapting its economy to the new millennium.

The 2008 State New Economy Index, released by the Information Technology and Innovation Foundation and The Ewing Marion Kauffman Foundation, nonpartisan policy organizations that promote entrepreneurship and innovation, lists New Hampshire as 13th in the country for its efforts in moving away from an economy based on older industrial models to one based on knowledge, innovation and technology.

Dr. Robert D. Atkinson and Scott Andes of ITIF, the index’s authors, define the “New Economy” as one that is “global, entrepreneurial and knowledge-based” in which “the keys to success lie in the extent to which knowledge, technology and innovation are embedded in products and services.”

Atkinson and Andes said the index measures the degree to which a state’s economic structure matches the ideal structure of the New Economy “and not merely economic performance or policies.”

It examines 29 indicators in five major areas, including knowledge jobs, globalization, economic dynamism, transformation to a digital economy and technology innovation capacity. States that ranked highest had the greatest concentration of high-tech jobs, educational institutions and entrepreneurial activity.

The researchers also said high-ranking states “tend to have a high concentration of managers, professionals and college-educated residents working in ‘knowledge jobs’ (jobs that require at least a two-year degree). With one or two exceptions, their manufacturers tend to be more geared toward global markets, both in terms of export orientation and the amount of foreign direct investment.”

Atkinson and Andes also said that states furthest along toward the New Economy tend to be “at the forefront of the IT and Internet revolutions, with a large share of their institutions and residents embracing the digital economy.”

New Hampshire ranked third in the country in immigration of highly educated knowledge workers into the state from outside of the country. The state also ranked third in alternative energy use.

“In the top six states … renewable energy accounts for more than one-third of their total energy consumption,” said the researchers.

The Granite State also did well in the percentage of the population online (fourth), foreign direct investment or the percentage of the workforce employed by foreign companies (fifth), and workforce education (sixth).

One interesting indicator in which New Hampshire ranked highly in was the use of the Internet in agriculture.

“Just as in other sectors, the New Economy is transforming agriculture,” they noted, adding that “two measures of this are the percentage of farmers with Internet access, and the percentage that use computers to run their farms.”

While the report placed New Hampshire eighth for online agriculture, it was tied with Connecticut, Maine, Massachusetts, Rhode Island and Vermont.

New Hampshire was also noted for moving up eight points in industry investment in research and development, from 16th in 2002 to eighth in 2008.

New Hampshire received low marks, however, for manufacturing valued-added per production hour worked as a percentage of the national average (39th), entrepreneurial activity (36th), use of technology in schools (39th), and the utilization of digital technologies by the government (47th).

Massachusetts was the number one state in the country for being the furthest along in moving into the New Economy.

In New England, Rhode Island ranked slightly ahead of New Hampshire at 11th, Vermont was ranked 19th and Maine at 28th.

Restaurant Values | A Quick Check

The following list was updated for the 2009 Business Reference Guide and the Business Reference Guide Online, which is continually updated.

Remember, that Rules of Thumb are just that, but will provide a quick “ballpark” idea of what these various food and drink businesses might sell for. Obviously inherent profitability, lease terms, FF&E and specific market location will all have a bearing. We will do a thorough analysis using different methodologies to determine the best offering price for a specific restaurant. BF

Bagels
30% to 35% of annual sales

Bars
50% of annual sales

Bar and Grills
(50% Liquor) 40% to 50% of annual sales

Barbecue
30% of annual sales

Bistros
30% of annual sales

Brew Pubs
40% of annual sales

Billiard Parlors
45% of annual sales

Cajun
30% of annual sales

Catering Businesses
30% to 40% of annual sales

Caribbean
30% of annual sales

Chicken
30% of annual sales

Chinese
30% of annual sales (Sales figures important)

Coffee Houses
40% of annual sales

Continental
30% of annual sales

Delis
30% to 40% of annual sales (30% if open 7 days; 40% if open 5 or 6 days)

Diners
30% of annual sales

Fine Dining
30% of annual sales

Gourmet Shops
30% of annual sales (inventory will be high)

Hamburgers
35% of annual sales

Ice Cream
35% to 40% of annual sales

Irish
30% - 40% of annual sales

Italian
30% to 40% of annual sales

Mexican
30% of annual sales

Night Clubs
25% of annual sales

Pancake Houses
30% of annual sales

Pizza (if delivery)
30% of annual sales

Pizza (if no delivery)
40% of annual sales

Sandwiches
40% of annual sales

Seafood
30% of annual sales (Very high food costs)

Sports Bars
40% to 45% of annual sales

Steakhouses
30% of annual sales (Very high food costs)

Moody's: Commercial real estate prices rise

NEW YORK—Commercial real estate prices increased in September, according to Moody's/REAL Commercial Property Price Indices, Moody's Investors Service said Wednesday.

The index rose 2.5 percent from August, but was down 7.9 percent from the year-ago level.

The CPPI now stands 9.4 percent below its peak in October 2007.

The index is based on repeat sales of the same properties across the U.S. at different points in time.

A price increase in September may seem "counterintuitive" because of a lack of liquidity and general turmoil in the financial markets and the general economy, Moody's said in its report.

"However, we believe this result can be explained by continued loss avoidance on the part of sellers and by the fact that many September closings occurred pursuant to contracts entered into in the summer, before the market turmoil of September and October," said Nick Levidy, Moody's managing director, in a news release.

Moody's also said part of the price increase also may be attributed to "some relative strength in the apartment sector," but the increase may not last.

"We believe that commercial property prices will soon start to decline again. As pressure continues to build in the sector, owners will begin selling into a deteriorating market at lower prices," Levidy said.

The top 10 markets showed modest gains in all property sectors in the third quarter, Moody's said. Office prices in the top 10 cities saw a 2.2 percent increase from the previous quarter.

Nationally, office prices were down 1 percent in the third quarter; industrial and retail prices were nearly flat; and apartment prices were up 2.3 percent.

Still, prices for the four property types are down significantly year over year, Moody's said. Compared with September 2007, apartments fell 7.2 percent, industrial dropped 10.1 percent, office was down 8.3 percent, and retail fell 9.9 percent.

Portsmouth's office market still healthy

Consultant believes demand will continue to grow despite economic woes

The former Portsmouth Herald building on Maplewood Avenue is an example of office space that is empty, but not for rent.Rich Beauchesne photo

By Shir Haberman

shaberman@seacoastonline.com

November 16, 2008 6:00 AM

There's been a lot of talk about the housing market here on the Seacoast, but the demand for office space is another indicator of the relative health of the local economy.

According to consultant Steven Berg, of Sargent Consulting Ltd. in Portsmouth, that market remains healthy as well, despite the economic downturn.

"What I'm here to tell you is that there's not much to tell you," Berg told members of the Portsmouth Economic Development Commission recently.

Berg estimated that about 8.6 percent of the city's nearly 3.8 million square feet of office space is currently empty. He clarified that "empty" does not necessarily mean available, citing the former Portsmouth Herald building on Maplewood Avenue and the Parade Mall as examples of office space that is empty, but not available.

"A range of 5 percent to 10 percent (of a community's office space being empty) is considered stable, so supply and demand appears to be stable," Berg said. "The amount of empty space (in Portsmouth) has averaged 7.9 percent over the past nine years surveyed."

However, Berg made it clear that his figures do not take into account office spaces in buildings of 10,000 square feet or less, or buildings, particularly at Pease International Tradeport that have office spaces that supports other operations, such as the now-vacant Pan Am Services building.

"One of the problems is that I have to draw the line somewhere," Berg said.

That omission prompted Portsmouth Realtor David Choate of Grubb Ellis/Coldstream to question Berg's figures if those other buildings are included in the analysis.

"My feeling is that if we went into those smaller spaces, the figure (for empty office spaces) would be closer to 20 percent," Choate said at the EDC meeting.

Berg flatly rejected that estimate.

"I agree the market may be a little softer than when I collected those numbers in the spring, but even if the figure were 10 percent, it would mean that I missed 360,000 square feet of empty office space," the consultant said. "I don't think so."

Berg said he ran his numbers past three local commercial Realtors who, he said, felt they were right on target.

The amount of office space in the city, including at Pease International Tradeport, has increased by 6.5 percent over the past year. On average, the citywide total of office space grows 4.3 percent a year, with the vast majority of office development happening at Pease, and very little in the downtown area and outlying areas.

Berg said he believes the increase in growth from 2007 to mid-2008 is the result of the addition of office spaces under construction including: Phase II of the 155 Borthwick Ave. project, the conversion taking place at 99 Bow St., Appledore Engineering's new building at 177 Corporate Drive, and the conversion of the old Flextronic building at 164 Corporate Drive into office space.

Berg said he expects the demand for new office space in the city to continue at a rate of about 75,000 to 100,000 square feet a year. That's because, according to a 2007 study by the state Department of Employment Security, New Hampshire's economy is expected to expand by 106,000 jobs by 2014, with the majority of new jobs expected to be in the service-providing industries.

"Because of Portsmouth's concentration in these employment sectors, these forecasts bode well for Portsmouth's future," Berg concluded.

With more than double the number of employers as exist in Dover and Rochester combined, and just about double the average annual employment, Portsmouth is the bellwether of the area's economy, the consultant said.

"Portsmouth is the economic engine that drives the region," Berg said. "What goes on in Portsmouth is what's happening in the region."

Maine Car Dealers Seek New Third Party Lenders

By Associated Press

November 09, 2008 12:37 PM

PORTLAND, Maine - Maine car dealers are turning to credit unions and other sources for third-party loans for their customers as bank financing becomes tighter.

Maine-affiliated banks are joining the ranks of national lenders who have cut back on or stopped lending money through automobile dealers, the Maine Sunday Telegram reported. As credit shrinks, dealers are having to turn to other resources.

Lee Auto Malls, for one, is providing more in-house financing to car buyers. It's also establishing new relationships with credit unions, which see loan opportunities as banks pull back.

"They're my new best friends," said Adam Lee, the company's president. "They want to loan money, they have members who buy cars, and I have a bunch of cars I want to sell."

Many banks and finance companies have tightened credit standards or are getting out of the third-party car-loan market because they can't borrow money to lend, or they're reluctant to lend and risk having customers default on their loans.

That means consumers are finding it harder to borrow money for cars and trucks, contributing to the downturn in U.S. auto sales, which in October slumped to their lowest level in 17 years.

Typically, seven of 10 buyers finance their vehicles through a dealer, working with third-party lenders and the financial arms of automobile manufacturers.

Ira Rosenberg, chief executive officer of Prime Motor Group, said he received letters in the past month from two Maine-based lenders, Bangor Savings Bank and Northeast Bank, and from North Carolina-based Wachovia Corp. saying they're getting out of third-party auto lending.

Those companies were among the top lenders in Maine, and their departure comes at a time when national lenders, such as GMAC Financial Services, are cutting back on the amount of credit they offer consumers. GMAC Financial, the lending arm of troubled automaker General Motors, announced last month it would only make auto loans to people with credit scores of 700 or above.

"It's a herd mentality," said Rosenberg, one of Maine's biggest car dealers.

Bangor Savings, which was a leading third-party auto lender in Maine, notified dealers in August of plans to exit the business in October. By coincidence, that's when the economic crisis hit.

"We had no crystal ball to show what was going to happen nationally to consumer lending," said Yellow Light Breen, a senior vice president at the bank.

Northeast Bank made the move in September, deciding it was more profitable and less risky to steer money to commercial loans, mortgages and home equity loans, said Jim Delamater, Northeast's president. Northeast continues to make car loans directly through its branches.

Not all banks are getting out of the third-party car loan business.

One of them, TD Banknorth, said it favors consumers with credit scores above 650 but considers each application on an individual basis. That approach isn't new, said Michael Copley, the bank's senior vice president for retail lending.

Dealers recognize the bank's conservative standards and don't forward loan applications from customers with lower scores or unfavorable credit history, he said.

Seabrook Industrial Space- 52,000 Sq Ft | For Lease

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