Cushman & Wakefield states the county's office vacancy rate at 14.8% for the end of March, just about flat from the 14.9% rate recorded for year-end 2005. Newmark Knight Frank on the other hand calculates the county's office availability rate at 15.3%, up one full percentage point from the 14.3% rate posted for the fourth quarter of 2005.
"The health of the market is so much better than it has been in the last 20 years," says Christopher O'Callaghan, a senior director with the Westchester office of Cushman & Wakefield of Connecticut.
O'Callaghan, who notes that the C&W Westchester office brokered more than 250,000 sf in office deals in the first quarter, says the continuing diversification of the business base in Westchester is paying dividends. He says that the county's office market is no longer dominated by large corporate tenants, such as IBM, and has been able to absorb some large space givebacks.
O'Callaghan and NKF managing principal John Goodkind agree on two major points--office rents in Westchester and most notably Downtown White Plains will be going up and office vacancies should decline. "We are advising our clients to sign now, because the rents are going to go north," he says. Citing a number of record commercial investment sales of late in Westchester, he adds that the buyers "are smart people and they are not paying these prices without the expectation of rents going up."
According to Newmark Knight Frank figures, rents are already on the rise. For instance, in Downtown White Plains, office asking rents have risen $1 per sf in the last year to the current $28.17 per sf level. Cushman & Wakefield calculates the city's office asking rent at $29.72 per sf at the moment.
Goodkind and O'Callaghan predict that the office vacancy rate in Downtown White Plains could be in single digits by year's end. Cushman has the city's office vacancy rate at the end of the first quarter at 13.3%, while Newmark pegs the first quarter 2006 office availability rate in White Plains at 14.3%.
Goodkind says that if tenant demand drives the vacancy rate in Downtown White Plains below 10% later this year, other areas of the county will benefit. "If White Plains is tight like that, it will parlay positively into the outer areas."
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John Jordan
John Jordan is a veteran journalist with 36 years of print and digital media experience.
