Fairfield County recorded 313,000 square feet of office leasing activity during the second quarter of this year, according to new data published by CBRE. This is down 43% from the previous quarter and 36% behind the region”™s five-year quarterly average ”” although it also is a 20% year-over-year improvement.
The region”™s availability rate during the second quarter registered a 110-basis-point uptick from the first quarter to 27.7%, the highest level in more than 10 years, after experiencing 423,000 square feet of negative absorption. CBRE attributed this to large space additions in the Stamford CBD, particularly the 326,000-square-foot block at 400 Atlantic St. and an 88,000-square-foot block of sublet space at 333 Ludlow St. The volume of available sublease space totaled 2.57 million square feet, which accounted for 23% of all available space.
During the second quarter, Class A space accounted for 85% of all leasing activity, with renewals outpacing new leases among the transactions. Four of the five largest transactions of the quarter were renewals: Indeed”™s 150,273 square feet at 177 Broad St. in Stamford; Merrill Lynch & Co.”™s 52,318 square feet at 301 Tresser Blvd. in Stamford; Indeed”™s 48,058 square feet at 107 Elm St. in Stamford; and Philips Domestic Appliance & Personal Care”™s 24,841 square feet at 1600 Summer St. in Stamford.
The largest new lease of the quarter was Subway Restaurants Inc.”™s 87,300-square-foot new headquarters at 1 Corporate Drive in Shelton.
CBD zones accounted for 41% of second quarter leasing activity, down from 44% in the first quarter. The Stamford CBD had the most leasing activity for the fifth consecutive quarter with 119,000 square feet, although that figure was also 38% below the five-year quarterly average. But activity in this submarket was driven by smaller transactions ”” the largest lease was Mirador LLC”™s 20,000-square-foot relocation to 850 Canal St.
The Fairfield East market had the second-largest leasing total at 97,000 square feet, with Subway Restaurants being the primary force of energy in that submarket. By the end of the second quarter, Fairfield East passed its five-year average by 93%.
The average asking rent for office space in Fairfield County during the second quarter was $35.17 per square foot, up 2% from the first quarter and flat year-over-year. The Stamford CBD had the largest quarterly rent hike, up 4% to $46.62 per square foot. The Greenwich CBD”™s asking rent of $89.66 per square foot was virtually unchanged from the first quarter and down 4% from one year ago.
On a year-to-date measurement, the region”™s 857,000 square feet of leasing in the first six months of 2022 was up 20% from the same period in 2021. Four of the seven submarkets in Fairfield County recorded higher year-over-year leasing, with Fairfield East”™s 200,000 square feet recording a 136% annualized upswing and the Greenwich Non-CBD up by 129% with 70,000 square feet.
