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The impact of diminishing supply of vacated call center facilities

by King White, on Nov 11, 2014 10:16:00 AM

The Great Recession left some great call center buildings available across the U.S. that helped companies expand their call center operations quickly and cheaply. However, many of the better facilities have been picked over leaving behind less desirable sites that are in poor condition or even worse, they are located in bad labor markets. To help understand the impact of this recent trend, Site Selection Group evaluated the availability of call center facility supply utilizing its proprietary database of vacated call center facilities.


Availability by facility size

There are almost 800 vacated call center buildings located across the U.S. The condition of these facilities will vary significantly. Many of these sites have all the furniture and generators in place while others will be stripped down to basically open office space. The following table summarizes site availability by size:

  Call Center Size# of Vacated Call Centers
  Less than 20,000 square feet 152
  20,000-39,999 square feet 211
  40,000-59,999 square feet 159
  Greater than 60,000 square feet 275

  

Availability by geography

Historically, there has been a greater concentration of call centers located throughout the Southeast, Southwest and Midwest where labor costs are low and economic incentives are readily available. As a result, there will typically be more vacated call centers available in those regions. States with a higher population and greater number of metro areas will typically have a larger amount of vacated call centers (i.e. Texas). The following map identifies which states currently have the greatest number of call center buildings available.

 

Availability by labor market size

From 2000 through 2010, there was a tremendous amount of growth in tertiary, smaller labor markets as companies were seeking lower-cost domestic locations for call centers. In the last several years, companies have migrated back to larger markets, as explained in our recent blog post “Why call centers are migrating back to larger metro areas” .  The following table breaks down the availability of call center facilities by the population size of the metro areas in which they are located.


Conclusions

With the availability of vacated call centers diminishing, companies will be forced to start converting former retail space and office buildings into call centers or building from the ground up. Companies will be forced to spend more capital than they have in the recent past and speed-to-market will be longer.  As a result, it is critical that companies carefully evaluate their call center location decisions to ensure they are in the optimal labor market. They should also leverage economic incentives that may be available by various economic development organizations.  

Topics:Call CenterEconomic Development

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