Even as a well-known racing school in western Connecticut made plans to hit the road with its administrative offices in favor of Nascar country, the local commercial office market failed to rev up in the first quarter ”“ but some expect that to change.
The Skip Barber Racing School L.L.C. is moving its business staff from Lime Rock Park in the northwest corner of Litchfield County to the Road Atlanta track in Braselton, Ga., where the company had already moved its logistics and maintenance operation last November.
Owned by Westport-based First Equity Group Inc., Skip Barber Racing offers corporate events at Lime Rock Park and said it will continue to operate its schools there, a popular draw for motor racing clubs and enthusiasts.
If no longer in the breakdown lane, the Fairfield County commercial office market nevertheless remained stuck in second gear in the first quarter, with a surprising climb in the vacancy rate and few moves that got attention from area real estate brokers. The biggest deal was simply signatures drying on a deal announced last year ”“ Chelsea Piers”™ lease of the former Clairol plant site in Stamford for a major new sports and entertainment complex ”“ sans racetrack, but with plenty of other options for corporate events.
“A lot of deals have run into the second quarter,” said Jim Fagan, senior managing director of Cushman & Wakefield”™s regional office in Stamford. “While we clearly see the bottom of the cycle in our rearview mirror, the path that we”™re on is rarely a straight path. Before, we were looking for events that turned into a trend ”“ now, it is a trend.”
The overall vacancy rate in Fairfield County edged up to 19.5 percent in the first quarter, according to the Stamford office of Cushman & Wakefield, up from 19.1 percent and 18.8 percent in the fourth and first quarters of 2010, respectively.
Despite the vacancy rate increase, the direct average rent also inched up to just above $33.50 a square foot, compared to about $32.70 in the fourth quarter last year and $32.80 in the first quarter of 2010.
Across the border in Westchester County, N.Y., word arrived that Bayer AG would consolidate its U.S. headquarters in New Jersey, a decision that will involve relocating hundreds of jobs south from Tarrytown. The restructuring marks Bayer”™s biggest overhaul of its tristate area operations since 2006, when it shut down a major campus in West Haven that subsequently was bought by Yale University. Yale plans to build its own massive life sciences research operation there.
Save the Bayer decision on Tarrytown, the Westchester office market otherwise fared better than that in Fairfield County, as Westchester”™s vacancy rate dipped to 16.7 percent in the first quarter, down from 17.1 percent in the fourth quarter last year and 17.5 percent at the start of 2010.
Employers have yet to put the pedal to the metal in terms of hiring ”“ but there is some acceleration in the local economy.
“The psyche of people has gone from cutting expenses to, ”˜Oh my gosh, now I have to make money again,”™” Fagan said. “Everyone we talk to is adding jobs.”
