Westchester's vacancy rate still dropping.
Corporate downsizing, once a negative impact on the market, has supplied the county with attractive and affordable blocks of space, which are now in high demand by growing high technology companies.
Westchester county experienced a record level of leasing activity during the first half of 2000, which totaled 741,659 sf, with significant leasing velocity in White Plains. The downtown White Plains market continued to tighten, with the overall vacancy rate steadily declining since last June from 27% to 19.7% at mid-year 2000. Leasing in the White Plains CBD area totaled 647,053 sf, accounting for more than one-third of the transactions in the county, more than double the activity recorded in the CBD area last year.
"Westchester County -- and especially White Plains -- is an attractive place for technology companies because of the tremendous fiber infrastructure. These high growth companies have shown to be nimble enough to respond quickly when properties with flexible blocks of space and the right technological infrastructure become available," said Kenneth M. Krasnow, regional managing director of Cushman & Wakefield's Westchester and Connecticut operations.
The year's most significant lease transactions for Westchester county were in White Plains. Starwood Resorts Worldwide signed the year's largest lease for 203,110 sf at 1129 Westchester Ave. Metromedia Fiber Network leased 79,735 sf and Heineken USA signed on for 63,436 sf at 360 Hamilton Ave., while Blue Sky Studios leased 42,571 sf at 44 S. Broadway.
Many tech-related companies relocated or expanded in Westchester. Below are highlights of leasing transactions concluded during the first half of 2000:
* 90,000 sf to MCI Worldcom Communications at 5 International Drive, Rye Brook
* 80,154 sf to Metromedia Fiber Network Services at 360 Hamilton Ave., White Plains
* 56,869 sf to TradeOut.com at 100 Summit Lake Drive, Valhalla
* 50,174 sf to Nextel of New York at Taxter Corporate Park, Elmsford
* 42,571 sf to InSite Services, LLP at Westchester One, White Plains
* 29,400 sf to Greenwich Technology Partners a 1123 Main St., White Plains (relocation from Conn.)
* 29,237 sf to OMfoney Financial Services Corp. at 1109 Westchester Avenue, White Plains
* 8,230 sf to AOL at 333 Westchester Avenue, White Plains
* 26,000 sf to Systems Management ARTS Inc. (SMARTS) at One Gateway Plaza, White Plains
* 22,400 sf to Lucent Technologies at The Summit at Westchester, Valahalla.
* 21,000 sf to SpirianTechnologies Corp. at 11 09 Westchester Ave. White Plains
* 19,240-sf to AT&T at 500 Mamaroneck Ave., Harrison
* 13,075-sf to CMGI Solutions at 360 Hamilton Ave. White Plains
According to Krasnow, "Several healthy 30,000 sf to 50,000 sf deals have been signed this year, most with longer lease commitments. Companies that relocated to Westchester a number of years ago are experiencing solid growth and are expanding within the county. This is a very healthy long-term trend that we expect to continue. Westchester is no longer beholden to major relocations from either Fairfield or Manhattan. Even though we anticipate that the average annual rents at some properties in White Plains will reach $35-per sf by the end of the year, the rates are still inexpensive compared to neighboring markets."
Many bullish investors are recognizing and finding value in the market. A few notable acquisitions in White Plains included: The Alaska State Pension Fund's purchase of the 521,059 sf One Gateway Plaza, located at One North Lexington Ave., for $76.3 million, and The Treeline Companies entrance into Westchester, acquiring two buildings totaling 210.150 sf located at 2 & 4 Gannett Drivel, for $24.1 million.
Several large opportunity and pension funds are actively seeking opportunities in the Westchester market. "We expect another one million square feet of product to trade by year-end, which will further diversify the owner profile in the market and provide needed reinvestments and technological improvements to meet the growing demands of tenants," added Krasnow.
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|Publication:||Real Estate Weekly|
|Article Type:||Brief Article|
|Date:||Aug 30, 2000|
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