Dean Shapiro, executive director of Insignia/ESG's Westchester and Connecticut operations, says that the office availability rate soared to 16.32% for Fairfield County, up significantly from the 9.14% rate posted a year earlier.
The county, which benefited greatly from the emergence and growth of new technology companies, saw a great deal of office space turned back to the market for lease due to the downturn in that sector in 2001. Shaprio relates the county ended the year with a negative absorption of 1.2 million sf of space.
In the fourth quarter, Crompton placed approximately 160,000 sf of space on the market for sublease at the Greenwich American Center and Modem Media in Norwalk put another 90,000 sf on the market as well.
The sublease component of the office market has shot up in the past 12 months. According to Insignia/ESG, the sublease market now accounts for 34% of the available office space in Fairfield County, up from 20% of the market at the end of 2000.
In addition, several spec building projects are near completion, (501 Kings Highway in Fairfield, 140,000 sf, and 601 Merritt 7 in Norwalk, 256,000 sf) adding approximately 400,000 sf of space to the market.
The downtown Stamford office availability rate rose from 8.77% at the end of the fourth quarter of 2000 to 13.67% at the end of 2001. Average asking rents in the Stamford central business district, also took a hit in 2001. The fourth quarter 2001 office asking rent in downtown Stamford was $31.41 per sf., down from $35.20 per sf at the end of 2000.
"I think Fairfield had a big recovery (in the late 1990s and in 2000) because it attracted a lot of new technology companies," Shaprio says. In 2001, the dot.com and new technology sectors were hit hard. Fairfield County's office market was also impacted by the national recession and the events of Sept. 11, which have led many commercial office space users to postpone their leasing decisions.
"Now the market is apprehensive, anticipatory of the economy and the prospects for a recovery," Shapiro says.
In terms of the future, he notes that the Fairfield County office market will likely be "reactive to how the national economy performs."
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John Jordan
John Jordan is a veteran journalist with 36 years of print and digital media experience.
