The segmented Greenwich commercial real estate market is seeing some movement as businesses take on smaller spaces downtown.
Industry watchers have always recognized the west side of Greenwich as offering slightly lower rents and larger space, while downtown offered prestige and a better location.
“I believe we have already seen the bottom on rents in the west and they are now on the rise,” said Steven Greenbush, first vice president at CB Richard Ellis’ Westchester and Fairfield operation.
“The big news is 777 West Putnam Avenue becoming available,” Greenbush said. “There is a great opportunity for a large user to come in. It”™s an upcoming vacancy and a great opportunity for a large tenant seeking a Greenwich location.”
Greenbush said the remaining tenants in west Greenwich”™s high-end office properties such as Greenwich Office Park are recommitting and expanding.
“As downtown rents have risen, the flight to the central business district has subsided,” Greenbush said.
The CB Richard Ellis Fairfield County Statistical Report for the first quarter of this year showed the non-central business district, of which western Greenwich is a part, with 568,231 square feet of class A and 81,595 of class B commercial space available to date in 2010.
Downtown had 297,164 square feet of class A and 11,733 square feet of class B available during the first quarter.
Of the 21 top transactions of 2010 year-to-date listed by CBRE none were in the Greenwich non-central business district, but three fell within the central business district.
“What we”™re seeing is that there are tenants that are renting smaller square footages along West Putnam,” said Ronald Brien realtor for M. H. Heaven Real Estate in Greenwich. “Some of those office tenants are actually moving east.”
Brein said because the west side of Greenwich offers generally large square footages they are quickly moving to the east side and downtown. He said the activity is stirring downtown on Greenwich Avenue, Mason Street, Putnam and Railroad Avenue
“They”™re filling in a lot of the office holes here in the downtown,” Brein said. “As recent as six weeks ago there was not nearly as much activity.”
Brein said the business that chooses to make the move holds off until say, staff is reduced by 40 to 50 percent.
“That”™s the magic number,” said Brein. “That”™s when the size just doesn”™t make any sense anymore. There”™s more activity now than I”™ve seen in the last 12 months.”
Bob Caruso, senior managing director of CB Richard Ellis’ Westchester and Fairfield operation said the Greenwich central business district has had a very strong quarter.
“In the coming quarter you”™re going to see some opportunities to attract some tenants out of New York looking for high quality space,” said Caruso.
