The Town of Chapel Hill has a space problem.

“Companies are trying to grow and expand,” said mayor Pam Hemminger. “There’s no place for them to go. There’s  not enough office space to go to.”

The Orange County Board of Commissioners and the Chapel Hill Town Council tried to tackle the issue in a joint meeting Thursday evening.

Both sides acknowledged the lack of space, saying that businesses have either turned away or been turned down because of it.

“We have a nine percent vacancy,” said Economic Development officer Dwight Bassett said. “We’ve approved just about 1 million square feet of office space that could be built in the future, but the market is just not driving office space for all of it to come out of the ground right now.”

Bassett said nine percent vacancy of office space means the town needs to add more.

But the town could also be losing out on potential development because of state incentives.

Currently the state offers money to certain businesses that bring job growth to an area. This could be $1,000 per job created or more depending on the project.

Orange County Economic Development director Steve Brantley said that money is only given if the local municipality decides to at least match the state funding.

“It creates a dilemma for the business because if they still pick that community, they would not get the state grant,” he said. “There could be examples of projects wanting to come to Chapel Hill that are incentivized at the state level.”

But commissioner Penny Rich said the county needs to be careful when thinking about development.

“You have people that want to have the amenities nearby,” she said. “If we start thinking about putting spaces out in the county, we need to be careful that we’re also putting amenities out there.”

Both Hemminger and board chairman Earl McKee said they wanted to move past a point of just talking.

“A lot of times we have these meetings and we get information but we really don’t interact,” McKee said. “I was hoping tonight on a couple of these items we might be able to frame at least how we move forward.”

McKee suggested that the county and town managers and staff work together to learn about the barriers to economic development and discover possible solutions.

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