Brokers Predict Steady Growth for Westchester Office Market

WHITE PLAINS-The Westchester County office market, devoid of any spectacular corporate relocation deals thus far in 2005, has remained relatively stable, according to recently released office availability reports by some of the region’s larger commercial office brokerage firms. Newmark, Cushman & Wakefield and CB Richard Ellis all report that the county’s office availability rate remained relatively stable between 14% and 15.8% Newmark calculated the office availability rate for the county at 14.3%, down from 16.1% three months ago and relatively flat from the 14.2% rate posted a year ago.

John D. Goodkind, managing principal of Newmark, says that White Plains has “been pretty solid” for the first half of 2005 and that Westchester County has held its own despite the lack of large transactions. Goodkind hinted that there are a number of pending deals in the pipeline that should keep Westchester on a growth track. “I think it is going to be steady as she goes for Westchester County.”

CBRE calculated Westchester’s office availability rate at 14.1% at the end of the second quarter. The firm’s officials note that leasing activity in the county has been centered in large part at RPW Group’s 800 Westchester Ave. building in Rye Brook, the former home of the Altria Group. In total, nearly 141,000 sf of space has been leased at the property in the first six months of this year.

Commenting on market conditions, Robert Caruso, managing director of CB Richard Ellis’ Westchester/Fairfield office, says, “Westchester once again demonstrated its resilience in the first half of 2005, as higher demand from midsized users offset the lack of mega-transactions and relocations.” He adds that the county is now in a position where mid-sized tenants have many options–even after the addition of a large block of available space at Reader’s Digest earlier this year. “Users with requirements exceeding 100,000 sf still only have four choices in Westchester County, down from 12 less than four years ago.”

C&W calculated the county’s second quarter 2005 office vacancy rate at 15.8%, down from 16.8% six months ago. Jim Fagan, senior managing director and head of the Westchester and Fairfield office of Cushman, notes that most of the county’s leasing activity in 2005 has been small to mid-sized lease transactions. “While major leasing activity in Westchester County for the most part took place at 800 Westchester Ave., several large deals in the pipeline and the continued improvement of the local economy are encouraging signs,” Fagan says.