It was a good year, 2007 ”“ much better in the first half before the credit crunch hit but still good overall ”“ in the commercial real estate market in Westchester County, a panel of experts agreed at the Building Owners and Managers Association”™s recent State of the Market luncheon.
It was a year of rising rents driven by the White Plains central business district ”“ where asking rents in office buildings near the Metro-North train station have climbed to the $40 to $45 range. It was a year of property sales topped by the $268-per-square-foot rate paid by New York City joint-venture partners O”™Connor Capital Partners and George Comfort & Sons Inc. with their $166 million purchase of The Centre at Purchase, a four-building corporate park on Manhattanville Road.
And 2008? Rents won”™t drop but will stabilize in an uncertain market, most panelists agreed. Sales and leasing velocity will slow down. The real estate market will not be as good as 2007, they opined.
“Fewer building sales in 2008,” said James C. Fagan, senior managing director of Cushman & Wakefield. “You”™ll start to see the credit crisis diminish in the fourth quarter. You”™ll still see building sales and prices won”™t diminish but velocity will slow down.”
In the leasing market, Fagan said, eight or nine tenants in Westchester occupying more than 100,000 square feet “are banging around right now and trying to decide what they”™re going to do.”
“Overall we”™re in a very, very supply-constrained market,” Fagan said. “I don”™t think it will be bad” in 2008, “but it won”™t be as good as 2007.”
“I think what we”™re going to have is slow, not nonexistent, growth” and “rents that remain relatively flat,” said Robert Caruso, senior managing director of CB Richard Ellis. “It is a good time to make a deal. It”™s a good time to be a landlord and a tenant. ”¦I think it”™s going to be a relatively stable year.”
Panel moderator Howard E. Greenberg, president of Howard Properties Ltd. in White Plains, noted transactions for less than 10,000 square feet accounted for 88 percent of office space leased in Westchester in 2007.
“I think it”™s a sign of the health of the Westchester market that you do have many small and mid-sized companies that are thriving, and great diversity,” said Jeffrey H. Newman, executive vice president of W&M Properties.
