Realtors are releasing year-end reports on commercial real estate that are showing more vacancies on the Seacoast and Interstate 93 corridor, as well as projections that lease rates will remain flat or dip more in the coming year, giving tenants more opportunities to negotiate.

David Choate, a principal for Grubb & Ellis/Coldstream Real Estate Advisors, Inc., said prospective tenants are striking deals to pay gross rent rather than triple net rates that may include things like taxes, landscaping and snow plowing that can fluctuate from month to month.

Tenants are winning "interesting concessions" such as convincing owners to install drywall, insulation and lights, and some are bargaining for the first one to three months rent-free, he said.

Thomas Farrelly, executive director for Cushman and Wakefield, said landlords are providing shorter lease terms to give tenants more flexibility in trying economic times.

Increased vacancy rates are also contributing to a "flight to quality" effect throughout much of the state for existing tenants, he said.

Bud Fini, a spokesman for Exeter-based gun maker Sig Sauer, said his company is evaluating a move to an alternative site because it is running out of manufacturing and warehouse space due to a flourishing firearms market.

"The fact that the (real estate) market is in many ways favorable only makes it that much better," Fini said.

In fact, vacancy rates for industrial space on the I-93/Route 3 corridor went up from 12.6 percent in December 2007 to 13.8 percent last December, and are expected to go up even more this year, said CB Richard Ellis in its year-end report, co-authored by Roger Dieker.

Industrial space is leasing at $6 per square foot on the corridor and could remain stable, the report stated.

And lease rates for office market space could drop. CB Richard Ellis' report said tenants with good credit could see "discounted asking lease rates by five to 10 percent, generous improvement allowances and free rent for a period of one to three months on three- to five-year lease terms."

Office space vacancies on the corridor remained stable at 13.7 percent in the past year, but could go up to 14 to 16 percent this year, the report stated.

Asking lease rates for office space remained at $8 to $14 per square foot in the past year, and are expected to decrease in the coming year.

In the I-95/Seacoast region the vacancy rates for industrial space went up from 8.5 percent to 11.4 percent in the past year, but vacancies there remain lower than in Boston or Manchester.

CB Richard Ellis projects vacancy rates for industrial space on the Seacoast to remain at 11 or 12 percent. Industrial space is leasing around $5 per square foot on the coast and is expected to remain stable.

The vacancy rate for office space on the Seacoast increased from 16.3 percent to 18.5 percent in the past year.

Pease International Tradeport continues to attract interest, and its vacancy rate was an exception, dropping from 18.7 percent to 11.6 percent, as many companies in the region continue to migrate to the Tradeport.

Office space leases remain at $16 to $21 per square foot at Portsmouth and $10 to $13 in the outlying region, and vacancy increases or lease rate changes are not expected this year, the CBRE report said.

Cushman and Wakefield released a report in January called Marketbeat in which the broker predicted sluggish activity for "at least the first half of 2009" and stated "the only market likely to see additional new construction is Portsmouth."

Mark Holden, president of Associated Builders and Contractors NH/VT Chapter, said the past year was good for commercial builders, but he noted commercial markets tend to lag behind the economy by 18 months.

A commercial market shakeout will occur this year and only then will realtors and builders get a true sense of the situation, he said.