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Suddenly, Space in Fairfield County
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Business New Haven
5/14/2001
By: BNH
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Significant new office space availabilities have given Fairfield County some breathing room according to the Insignia/ESG First Quarter Commercial Market Report.
The availability rate edged up almost a full percentage point from the first quarter of 2000 to 11 percent, as more than 592,960 square feet of negative absorption impacted the market. According to the report, at the end of the same period of last year Fairfield had seen 673,280 square feet of positive absorption. Approximately 1.2 million square feet was leased countywide on the first three months of 2001, 25 percent more than the average amount leased per quarter over the last ten years. However, the report points out that this number is 17 percent below the 1.4 million square feet in the same period a year ago.
According to the report, “Most of us believe Fairfield County's current increase in availability is a short-term effect of ongoing economic uncertainty. Businesses are playing it close to the cuff and limiting their spending during what is essentially a pause in the market.”
Insignia/ESG says leasing remains relatively healthy, although at lower levels than last year. Because there is little or no new construction, the company expects the existing vacancies to be filled.
The eastern Fairfield County office market performed well during the first quarter, with six of the top ten transactions countywide in this area. According to Insignia/ESG, “Leasing velocity rose 79 percent to 596,090 square feet due in part to pre-leasing at properties under construction and net absorption reached positive 181,510 square feet. Consequently, the segment's availability rate fell 7.6 percent, the lowest in the county and almost three percentage point below the first quarter of 2000. These impressive gains were made despite the fact that large amounts of space came back on the market in this area in the past three months.”
The largest leases in eastern Fairfield County included: TransSwitch Corp's 95,390 square feet at 4 Enterprise Drive, Shelton; Cooper Surgical's 92,000 square feet at 95 Corporate Drive, Trumbull; American Skandia Group's 53,650 square feet at 4 Enterprise Drive, Shelton; and Lifecare.com's 52,410 square feet at 2 Armstrong Road, Shelton.
The report lists the average rental rate as $24.34 per foot, an increase of $4.65 a year ago. This rate is, according to Insignia/ESG, far below the average asking rents further south in Fairfield. To obtain the data for this report, Insignia/ESG surveyed 496 multi-tenant Class A and B buildings in Fairfield County. Government-owned and -occupied buildings, medical office buildings and buildings of less than 20,000 square feet were excluded.
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