Westchester's Office Availability Rate Falls

According to figures released by Newmark & Co. Real Estate and Cushman & Wakefield, the office availability rate for Westchester County fell more than 1% at year's end 2003 as compared to the same period in 2002.

John Goodkind, managing principal of Newmark's Westchester and Connecticut offices, says Westchester County's office availability rate stood at 14% at year's end 2003, down 1.2% from a year earlier. He says that Westchester County "continues its positive momentum" entering 2004. In fact, he reveals that there are several large users currently studying the Westchester market looking for between 75,000 to 100,000 sf of office space each.

Goodkind predicts that availability rates will remain stable this year, as will office rents in Westchester County. At the end of 2003, average asking rents in Westchester County stood at $24.41 per sf, down 15 cents per sf. from the rate posted a year ago.

Cushman & Wakefield's Jim Fagan, senior managing director and head of the Westchester/Fairfield County region, says his firm projected Westchester's fourth quarter office vacancy rate at 15%, down from 16.4% at the end of 2002.

Commenting on recent activity, Fagan says, "The drop in availability and vacancy rates in the Westchester County market points to the terrific business climate that exists there. As the economy continues to improve, we expect vacancy rates to continue to decline through the balance of 2004."

The only down note of late in Westchester has been the Altria Group's decision to vacate its 625,000-sf complex at 800 Westchester Ave. in Rye Brook and put it on the market for sale. Goodkind says that the property will pose a "challenge" to the market since he suspects it will have to be marketed mainly to large users. However, he says the availability will not derail the positive momentum the county is currently enjoying.

Cushman's Fagan notes that the vacancy of 800 Westchester "will affect the market statistics more than it will actually affect the market." He adds that the property should be desirable to a large, single/tenant user who might expand or relocate to Westchester.

"We don't expect that the property will attract or be marketed to tenants smaller than 50,000 sf," he says. The Altria Group has hired CB Richard Ellis to market its property for sale.