Major corporate givebacks of space in the fourth quarter definitely contributed to the rise in office availability rates, says Kenneth M. Krasnow, regional managing director of Cushman & Wakefield of Connecticut. Another cause for the jump in rates was the fact that the former headquarters of Texaco (now Chevron/Texaco) in Harrison has been included in the availability rate numbers since it is now on the market for sale.
The downtown White Plains market got hit hard as well in the fourth quarter. While sublease space impacted every region in Westchester, the availability rate in downtown White Plains shot up from 15.1% in the fourth quarter of 2000 to 23.2% at year's end 2001.Some of the large blocks of space put on the market in the fourth quarter and now being marketed for sublease in White Plains include: approximately 150,000 sf of IBM space and Blue Sky Productions' 40,000 sf of space at 44 South Broadway and Metromedia Fiber Network's 50,000 sf of space at 360 Hamilton Ave.
Krasnow says that the market is seeing some leasing activity in early 2002 and market conditions should improve as the year progresses.
"We expect (leasing) demand to increase in the third or fourth quarter of this year," Krasnow says. In fact, once the market does pick up, he believes the first area that will benefit will be downtown White Plains.
He adds that White Plains, which in the early 1990s posted availability rates of approximately 30%, "enjoyed a good ride" the last few years when leasing activity, especially by high technology firms, led to a steady and dramatic decline in its office availability rate. Now, downtown White Plains is experiencing some of the fallout due to the downturn in the high technology sector.
Krasnow says that the sublease market is now a major component of the overall office market in Westchester County. According to C&W figures, sublease space accounted for approximately one-third of all available space in downtown White Plains as compared to approximately 14.9% of the available space there at year's end 2000. Overall, sublease space accounted for 18.6% of the available space in Westchester County at the end of the fourth quarter 2001, compared to 11.6% of the available space market a year earlier.
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John Jordan
John Jordan is a veteran journalist with 36 years of print and digital media experience.
