Even in the midst of an economy stung by a sliding stock market, rising mortgage foreclosures and a mounting credit crunch, owners of one of Lawrence’s largest office projects see opportunity in their corner of the market.

Greg DiVilbiss and his partners in The Bristol Groupe this month sold off one of their commercial developments to finance the pursuit of what they consider an even brighter future: another office building farther south off Wakarusa Drive, one big enough to attract regional corporate headquarters, back-office operations or other tenants and their steady jobs to town.

“We believe the office market is about ready to take off,” DiVilbiss said.

He’s counting on it.

By selling their Wakarusa Crossroads shopping center at Sixth Street and Wakarusa Drive, DiVilbiss and his partners received a $9.9 million check – money they wanted so that they could consolidate ownership in Wakarusa Corporate Centre and move ahead with plans for another building there.

The center’s initial building, at 4910 Corporate Centre Drive, today is 70 percent occupied, after spending much of its history sitting empty. The building had been completed in September 2001, just as the economy had started to slow down following the 9/11 terror attacks.

This time, DiVilbiss and his brother and business partner, Dan Kirk, intend to have leases lined up for the bulk of the new building before breaking ground.

“The only question is going to be whether it will be two stories or three stories,” DiVilbiss said. “If things go right, it will be three stories and 76,000 square feet. : Now we’ve got everything in place to start that. It’s just a matter of getting the people who are interested in coming to Lawrence lined up.”

Back in the game

Observers of the office market say they’re seeing increased activity in the sector, which has been considered weak since 9/11.

Of the 2.7 million square feet of office space in the Lawrence market, nearly 400,000 square feet was available at the beginning of the year, according to a market analysis compiled by Grubb & Ellis|The Winbury Group. The real estate company opened the year by forecasting that the vacancy rate of 14.4 percent would decline to 13 percent by year’s end.

Now the vacancy decline no longer is a projection – it’s a reality.

“We’ll do all of that,” said Kelvin Heck, senior vice president for Grubb & Ellis|The Winbury Group, 805 N.H. “We have done all of that to date. I don’t know what else is going to happen, but : we’re going to start seeing some speculative building activity, at least in limited quantities.”

The rising interest in office projects really isn’t much of a surprise, Heck said, given Lawrence’s long history of steady economic growth and desirable quality-of-life aspects. That it’s taken six years to start regaining traction may be the only stunner.

Now, it’s up to developers to decide when to get back in the game.

“Lawrence has been, traditionally, a pretty solid market, with pretty solid demand into it,” Heck said. “It’s measuring your risk versus your ability to hang onto an empty building.

“The market generally rewards those people who are in it first – generally it does,” Heck said. “The person that comes in second, third and fourth will have higher costs, and miss that first round of tenants who may be backed up and waiting to come in. But it’s a tough decision to know when to pull the trigger.”

Looking ahead

Dick Wise, owner of Wise Construction Management, cautions against getting too excited about office projects. He remembers getting started in the business back in 1977, in Houston, when piles of oil money funded a rush of office towers.

While Lawrence is far from such activity, he’s hopeful things will pick up. He’s confident that the city’s image for accommodating business needs is improving in development circles, and could lead to more companies keeping Lawrence on their lists of prospective locations for new offices.

“Once the environment changes, people who haven’t looked at Lawrence will start looking again,” he said.

DiVilbiss said he’s already taking such preliminary calls as potential tenants search for relatively large floor spaces to accommodate dozens of employees.

To take care of such callers, The Bristol Groupe intends to keep going with plans for several office buildings off Wakarusa Drive, work that could bring the total investment on site to $40 million or $50 million, DiVilbiss said.

“We’re pretty excited about it,” he said. “It’s a good thing, and the timing is right.”