Opportunity Knocks
It seems the news about the economy just keeps getting worse, and rightly so. The economy itself keeps getting worse.
Everyone from first-time homeowners to some of the largest companies in the world played a part in the current global economic meltdown and it will take years to uncover and tell all the stories of how it happened.
One thing we feel should be said, though, is that this is not the time for businesses to head for shelter and wait for the storm to pass.
Get Aggressive
Sure, hatches must be battened down, belts must be tightened. Use whatever analogy you like. But smart businesses should also be prowling for opportunities, anticipating not just the end of the economy’s struggles, but increased growth and market influence of their own.
Recently, several Central Massachusetts businesses and individuals have demonstrated that they understand this.
At the very beginning of the year, Intrepid Advisors LLC of Westborough bought CCR Cost Recovery Services LLC from New England’s largest accounting firm CCR LLP. The acquisition not only provides Intrepid with instant growth, but positions the company, which specializes in getting firms the maximum allowable amount of state and federal research and development tax credits, for success in an economy that is becoming more and more reliant upon research and development.
In February, Marlborough-based data warehouse company Netezza Corp. acquired data security and auditing firm Tizor Systems Inc. of Maynard for a mere $3.1 million, underlining the fact that a weak economy may be the best time for a company to acquire competing or complimentary companies.
When Valeritas, a New Jersey-based medical technology company, announced that it would expand its Shrewsbury facility, a company spokesman made it sound as if not expanding was never an option. “Even with the economy,” she said, “we know we’re going to need the space.”
And then there’s the downtrodden real estate marketplace. Sellers may not be happy, but buyers can now take advantage of some very good deals, and now is the time to do so. Buyers can’t wait to be told that the market has turned around. By then, they will have waited too long.
Buyer’s Market
In Marlborough, local investor Samir Zebian made the most of the market when, in January, he bought a fully-leased, 28,000-square-foot warehouse and office building at 85 Hayes Memorial Dr. for $2.1 million.
Commercial real estate sale prices plunged by more than 65 percent between the fourth quarter of 2007 and the fourth quarter of 2008, according to real estate tracker The Warren Group. And although it is difficult in this economy to call anything a bargain, what Zebian bought was a stable, income-producing property that will demand a higher lease rate in three years — when the current lease expires — than it does today. Zebian paid a fair price for 85 Hayes, and has positioned himself as a property owner in one of the most sought-after markets in the state in plenty of time to take advantage of increased leasing to high-tech, biotech, pharmaceutical and green technology companies.
Companies also have found the gumption to move and expand.
Mylec Sports Inc. of Winchendon plans to build a 45,000-square-foot manufacturing and distribution facility at a business park just off Route 140 in town. Joining the sports equipment manufacturer in the park will be Sage Engineering LLC, an expanding Westfield-based firm that intends to build a 20,000-square-foot facility, its first in Central Massachusetts.
We know well that times are tough. We know about the wage cuts, the layoffs and the shortened work weeks. We know that in the face of decisions like those, a company may not feel it appropriate or wise to also spend on acquisitions, real estate or expansion. But we urge the Central Massachusetts business community to think otherwise.
Thomas Edison famously said, “Opportunity is missed by most people because it is dressed in overalls and looks like work.”
It’s time for Central Massachusetts’ opportunists to get to work.
WBJ Web Partners
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