Home Economy CBRE shows Westchester office leasing looking up

CBRE shows Westchester office leasing looking up

According to commercial real estate services and investment firm CBRE, third-quarter leasing activity in Westchester County was up 40% from the second quarter.

There was a total of 216,000 square feet of new leasing activity during the period, according to the report. Extensions and expansions by existing tenants accounted for 49% of the leasing activity for the quarter, according to William Cuddy, executive vice president at CBRE.

“In a market where leasing activity is habitually dominated by intra-county moves, this trend confirms Westchester County’s healthy economy and tenant satisfaction,” said Cuddy, who is based at CBRE’s Westchester/Fairfield office in Stamford.

Average asking rents in Westchester during the third quarter of 2019 dipped slightly from the same period last year.; the drop of 3.7% was due to comparatively expensive space previously having been leased or otherwise removed from the market this year, according to CBRE.

The average rent was $28.44. Average asking rents in Westchester over the past five years have risen 4%. The average taking rents, however, rose 9.4% from $24.69 per square foot to $27.01 per square foot.

Net absorption for the quarter in Westchester was 76,940 square feet.

1311 Mamaroneck Ave. in White Plains.

The top lease transactions in Westchester during the third quarter of 2019 were: a renewal for 120,000 square feet at 2000 Westchester Ave. in Harrison by Atlas Air Worldwide Holdings; 61,971 square feet leased by Montefiore Medical Center at 555 Taxter Road in Elmsford; 21,041 square feet leased by Intercontinental Exchange at 1311 Mamaroneck Ave. in White Plains; a renewal by the New York State Appellate Court of 17,800 square feet at 140 Grand St. in White Plains; and a lease by Allstate Corporation for 15,000 square feet at 120 White Plains Road in Tarrytown.

The report characterized leasing activity in Northern Westchester as being “particularly quiet” during the quarter, with only 17,000 square feet of leasing activity. It said that represented a 42% drop from what was done in the third quarter of 2018 and 56% below the five-year quarterly average.

The report said Westchester’s overall economy remained solid and pointed to a 4.1% unemployment rate as of August 2019. “For a broader comparison,” the report said, “the unemployment rate is 4.2% in New York state and 3.7% nationally. The Orange-Rockland-Westchester market area, of which Westchester makes up about 60% of the population, saw a net collective increase of 4,100 jobs from August 2018 to August 2019.”

CBRE noted that the financial activities sector — a heavy user of office space — saw a year-over-year job increase of 2,100.

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