The Research Consulting Services Group of Cushman & Wakefield of Connecticut reports that the county's market recovery is in full swing, posting a 15.1% overall vacancy rate at mid-year 2000, up from the 17.8% rate of last June. Recently, Insignia/ESG officials released the firm's mid-year report noting that the county's office sector, particularly in White Plains, has shown vast improvement.
The area is, "an attractive place for technology companies because of the tremendous fiber-optic infrastructure," says Kenneth M. Krasnow, regional managing director of Cushman & Wakefield's Westchester and Connecticut Operations based here. "These high growth companies have been nimble enough to respond quickly when properties with flexible blocks of space and the right technological infrastructure become available."
Westchester County saw a record level of leasing activity during the first half of 2000, totaling 1,741,659 sf, with significant velocity in White Plains. The city's downtown market continued to tighten, with the overall vacancy rate steadily declining since last June from 27% to 19.7% at mid-year. Leasing in the White Plains CBD totaled 647,053 sf, accounting for over one-third of county transactions, more than double that of last year.
Krasnow adds that a host of e-commerce and high technology companies have signed leases in the 30,000 sf to 50,000 sf range. In addition, companies such as Heineken USA, Starwood Hotels and Resorts Worldwide, which relocated to the county several years ago, have experienced solid growth and expanded their presence in the county this year.
"Westchester is no longer beholden to major relocations from either Fairfield or Manhattan," he says. "Even though we anticipate that the average annual rents at some properties in White Plains will reach $35 per sf by the end of the year, Westchester is still inexpensive compared to neighboring markets."
The C&W report also notes that commercial investment sales have been vigorous this year, with a number of large properties changing hands. They include the Alaska State Pension Fund's purchase of the 521,059-sf, One Gateway Plaza at One North Lexington Ave. in White Plains for $76.3 million and The Treeline Companies acquisition of 2 & 4 Gannett Drive in Harrison for $24.1 million.
Several large opportunity and pension funds are actively seeking properties in the Westchester market, Krasnow says. "We expect another one million square feet of product to trade by year-end, which will further diversify the owner profile in the market and provide needed reinvestments and technological improvements to meet the growing demands of tenants," he adds.
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John Jordan
John Jordan is a veteran journalist with 36 years of print and digital media experience.
