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Vacancy falls in Fairfield County market.

Fueled by major corporate expansions in downtown Stamford and the Shelton-Trumbull area, the Fairfield County office market rebounded sharply in the third quarter of 1996, according to the Rostenberg-Doern Quarterly Office Market Report.

Absorption for the past three months totaled nearly 590,000 square feet of space, a dramatic turnaround from the negative absorption of approximately 79,000 square feet three months ago. The county's vacancy rate, which stood at 15.7 percent at midyear, fell to 13.9 percent. Construction activity for the quarter was at 740,000 square feet, unchanged from three months ago.

The Shelton-Trumbull area led the market with 371,651 square feet of space absorbed.

In what was the largest corporate headquarters sale in Fairfield County in many years, Physicians Health Services Inc. (PHS) acquired the 327,195 square-foot Shelton Corporate Center from Richardson-Vicks Real Estate, Inc., a subsidiary of Procter & Gamble.

"Despite a slow start earlier this year, the Fairfield County office market is doing extremely well. Rents in Class A space in Stamford are up almost 15 percent in the past nine months. Rents are now at a level where you can build and lease profitably," said Gerard P. Hallock, SIOR, senior vice president of Rostenberg-Doern.

Hallock said much of the market's leasing activity involves companies expanding within the county, with some activity from companies relocating from New York City. He said downtown Stamford had its share of major corporate leases in the third quarter by companies such as A.C. Nielsen, Citicorp, Philip Morris Capital Corp., ITDS, and Reuters. "Stamford's premier office buildings continue to see tremendous leasing activity, with the vacancy rate for Class A buildings falling to 7.3 percent," he said.

The survey of Fairfield County's four market areas showed the following:

Fairfield County Central Business District

More than 270,000 square feet of space was absorbed in downtown Stamford in the quarter. The city's third-quarter vacancy rate of 12.6 percent is down two percentage points from mid-year. The acquisition of Landmark Square by Reckson Associates Realty was a positive development for this market. Major deals included A.C. Nielsen, Carol Wright, Citicorp, Cox Media, Executive Health, ITDS, Philip Morris Capital Corp., Reuters, and Tradition Financial.

Fairfield County East

Led by the PHS acquisition of Shelton Corporate Center, the Shelton-Trumbull market absorbed 371,651 square feet of office space during the quarter. The vacancy rate fell from 20 percent at mid-year to 15.4 percent. In a major recommitment to the Bridgeport area, Peoples Bank Credit Card relocated within the city to larger space. Major deals included Cambridge Group, Creative Insurance, Louis Dreyfus, New-Net, Peoples Bank Credit Card, PHS, and Welsley Software.

Fairfield County West

The Greenwich-Norwalk office market suffered a setback with the addition of nearly 113,000 square feet of space returned to the market by Pitney Bowes in Norwalk. Total absorption for the quarter was a negative 103,765 square feet, while the vacancy rate rose from 9.3 percent at mid-year to 10.5 percent. On the plus side, there were significant leases by Coldwell Banker Relocation, Quantel Communications, Paine Webber, and Rogers & Casey.
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Title Annotation:real estate industry in Fairfield County, Connecticut
Publication:Real Estate Weekly
Date:Oct 16, 1996
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