A massive wall of windows at Four Stamford Plaza reflects the sky for drivers speeding by on Interstate 95. What is going on behind those windows might reflect the speed at which Fairfield County bounces back from the recession.
In the past three months, RFR Realty has completed about a dozen leases totaling 140,000 square feet of space in its seven buildings in downtown Stamford, even as it says other landlords have suffered lackluster activity.
Stamford won a stunning coup last month in attracting Starwood Hotels & Resorts Worldwide Inc., and the market has buzzed with rumors of other deals. But the mid-size and small-office market remains a significant indicator of jobs, and as RFR goes, so goes the downtown market. Some 80 percent of all deals in downtown Stamford occur in its buildings, which include: One, Two, Three, and Four Stamford Plaza; 177 Broad St.; 300 Atlantic St.; and Canterbury Green.
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While Stamford”™s vacancy rate escalated sharply in the third quarter, that was partly the impact of the emptying of Financial Centre at 695 E. Main St., whose manager”™s have not been renewing leases as the building”™s ownership is worked out as part of the Lehman Holdings bankruptcy case. According to FirstService Williams, the exodus from Financial Centre pushed Stamford”™s availability rates to 27 percent in the third quarter.
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Prospective tenants are weighing the pros and cons of securing a long-term lease now to take advantage of rental concessions by many landlords, versus signing shorter term deals in hopes those concessions will only grow next year on the assumption of continued job losses in Fairfield County.
Margaret Carlson, RFR Realty”™s Stamford portfolio director, attributed the surge in RFR”™s leasing not to any rebound in the economy, but rather the attractiveness and location of the buildings, which have undergone significant renovations in the past year; and to the reputation and financial stability of RFR itself, which bought the buildings for $500 million at the peak of the last economic cycle.
Carlson said that rents in the RFR portfolio are competitive, but not underpriced. Three recent deals garnered more than $50 per square foot, well above the average rent both in RFR”™s Stamford portfolio and for downtown in general, where rents range between $35 and $38 per square foot.
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“RFR makes it easy to do a deal by accommodating specific requirements and lease terms and being flexible enough to find tenants exactly the right space, even if that requires moving things around,” Carlson said. “These leases confirm that top-tier companies are still establishing and expanding their presence in downtown Stamford in buildings known for their long-term, financially strong ownership. We expect the momentum to continue through year-end and into 2010.”
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Since late summer, RFR has signed several new leases, the largest of which was Noble Americas Corp. decision to relocate its headquarters into 34,000 square feet of space at Four Stamford Plaza.
Executive search firm Spencer Stuart took 24,000 square feet of space at Two Stamford Plaza, while Pierpont Securities took more than 13,000 square feet in the same building.
RFR”™s Canterbury Green building also got two new tenants in McCarter & English L.L.P., which took 16,000 square feet; and in Korn/Ferry International, which relocated its Stamford office from 695 E. Main St., taking more than 12,000 square feet.
An affiliate of L-1 Identity Solutions Inc. leased more than 16,000 square feet at 177 Broad St.
Robert Half International and Spruce Private Investors took under 10,000 square feet respectively at Three Stamford Plaza and One Stamford Plaza, with the latter building also getting Teleos Management.
Ondra and O”™Brien International leased small offices at 300 Atlantic St. and Canterbury Green.
