CBRE”™s Westchester County/Fairfield County office recently announced first-quarter leasing results for the office sector for both counties in a document it terms a snapshot.
Westchester County lagged behind Fairfield County, with Westchester”™s total commercial leasing for the quarter ”” 269,225 square feet ”” failing to equal the largest deal in Fairfield, where a financial services firm leased more than 300,000 square feet.
In Fairfield County, leasing during the quarter outpaced that seen over the last quarter of 2014, rising 47 percent to 887,414 square feet. “This was higher than the five-year historical average and is seen as a marker of increased tenant confidence,” CBRE said in a statement.
Fairfield County”™s availability rate edged up to 21.1 percent in the first quarter, from 20.5 percent in the previous quarter, even as rents per square foot in the same period went from $35.30 to $35.65. The vacancy rate fell from 19.7 percent to 19.4 percent between the fourth quarter of 2014 and this year”™s first quarter.
Westchester County ended the first quarter of 2015 with an uptick in its availability rate and a slowdown in overall leasing activity. The availability rate rose over the quarter from 18.9 percent in the fourth quarter of 2014 to 21 percent. Leasing during that period fell from 296,107 square feet to 269,295 square feet.
The largest deal in Fairfield County for the quarter was Synchrony Financial”™s 312,000 square feet at 777 Long Ridge Road in Stamford. Other large transactions included 84,504 square feet leased by Frontier Communications at 401 Merritt 7, Norwalk; 40,000 square feet leased by AMG Funds at 600 Steamboat Road, Greenwich; 38,131 square feet leased to Bridgewater Associates at 1001 Main Ave., Norwalk, and another 27,176 square feet at 500 Nyala Farms Road, Westport; and 20,000 square feet to Security Benefit at 600 Steamboat Road, Greenwich.
Both the central business districts and noncentral business districts contributed the largest volume of returns to the overall market, CBRE reported. “Partly as a result of these returns, there was 232,395 square feet of negative absorption in the county during the quarter,” the company said. Corporate contributors to the negative absorption number included International Paper”™s office at 400 Atlantic St. and Frontier Communications”™ office at 3 High Ridge Park in Stamford.
Overall average asking rents in Fairfield County finished at $35.63 per square foot, up slightly from $35.30 per square foot in the fourth quarter of last year.
For Westchester County, the largest lease transaction for the first quarter was a 30,000-square-foot lease by the Federal Bureau of Investigation at 600 Midland Ave. in Rye. Other top transactions included 26,885 square feet leased by the Legal Aid Society at 150 Grand St., White Plains; 17,376 square feet leased by PURE Insurance at 44 S. Broadway, White Plains; 15,868 square feet leased by Teladoc Healthcare at 2 Manhattanville Road, Purchase; 10,800 square feet leased by Coca-Cola at 555 Taxter Road, Elmsford; and 10,098 square feet leased to Medical Management Solutions at 120 White Plains Road, Tarrytown.
Low leasing velocity contributed to an overall negative net absorption of 586,053 square feet, CBRE reported, with the big contributor being PepsiCo”™s return of 539,995 square feet to the marketplace at 1 Pepsi Way in Somers. Meanwhile, the vacancy rate fell almost a full percentage point across the county between the fourth quarter of 2014 and the first quarter this year, from 19.2 percent to 18.3 percent.
Overall average asking rents in Westchester dropped slightly from $27.29 per square foot to $27.26 per square foot over the quarter. Submarkets with the highest average asking rents included Westchester West at $24.19 per square foot and the White Plains central business district at $30.61 per square foot. The Westchester North submarket witnessed the largest increase in its availability rate, by nearly 8 percent quarter-to-quarter to its current 23.8 percent.
