Westchester posts strong third quarter

Real Estate Weekly, Oct 11, 1995

Driven by strong leasing activity along the I-287 and Route 119 office corridors, the Westchester County office market absorbed nearly 221,000 square feet of office space during the third quarter of 1995, according to the Rostenberg-Doern Quarterly Office Market Report.

Absorption totaled 220,713 square feet for the quarter, more than twice the amount of space absorbed during the first half of the year. The third-quarter vacancy rate for the county was 20.8 percent, down from 22.1 percent at midyear. Four of the five market areas surveyed in Westchester County reported positive absorption and lower vacancy rates.

Downtown White Plains, which is the county's central business district, reported a negative absorption of more than 111,000 square feet and a vacancy rate of 32.1 percent, up from 30.3 percent three months ago.

The news from downtown White Plains was not all negative. Prodigy Services said it was not moving its headquarters to Manhattan, as was previously announced. In another positive development, Connecticut-based Oxford Health Plans is reported to be considering expanding its operations to the Westchester One office tower.

Major leases signed in the third quarter included ITT's 52,000 square-foot lease in Harrison, Human-I-Tees' 50,000 square-foot lease in Valhalla, and Dannon's 12,900 square-foot expansion in Tarrytown.

"Thanks to a surprisingly strong third quarter, the Westchester County office market appears to be on track for a very respectable year in 1995. There are a number of significant transactions in the market that we anticipate will be completed by the end of the year. Barring any major corporate downsizing, total absorption for 1995 should exceed a half million square feet," said Michael A. Klein, senior vice president of Rostenberg-Doern Company.

Westchester County CBD

With few significant leases to report, the downtown White Plains office market suffered a negative absorption of 111,192 square feet of space. The Centroplex Building added nearly 59,000 square feet of space, while 50,000 square feet of space is available at the former Federal Courthouse Building.

Westchester County East

Westchester's largest office market, the I-287 office corridor. was also the strongest in the third quarter, reporting absorption of 127,476 square feet of space. The vacancy rate in this market, which includes Harrison, Purchase and Rye, dropped from 20.9 percent at midyear to 19.3 percent. Major deals were signed by Best Priced Products, ITT and Westchester Business Journal.

Westchester County West

The office market in the western half of the county, which is located primarily along the Route 119 corridor, reported absorption of 104,278 square feet for the third quarter. The vacancy rate was 12.9 percent, down more than three points from 16.2 percent just three months ago. Also during the third quarter, Ciba Corp. completed its corporate headquarters move from Ardsley to Tarrytown, and its 130,000 square-foot lab is still under construction. In one of the largest transactions of the quarter, Amscan Inc. of Harrison acquired the Heritage Corporate Park in Greenburgh for its new headquarters.

Westchester County North

Absorption in the northern half of the county totaled 84,972 square feet for the quarter and the vacancy rate fell from 23.7 percent at midyear to 19.4 percent. The largest transaction for the quarter was the move by Human-I-Tees from Class C space in Pleasantville to 50,000 square feet of Class A space in Valhalla. Major deals were also inked by Anvik Corp., Cube Computer Corp., and Helix.

Westchester County South

A modest 15,179 square feet of space was absorbed in the county's southern office market during the third quarter. This market, which includes Yonkers, New Rochelle and Mount Vernon, also posted a decline in vacancy rate from 13.2 at midyear to 12.5 percent. Major deals included leases by Gallagher Benefit Services and Spizirro/-Sciacca & Chiapetta.

More than 260 multi-tenant Class A and B buildings in Westchester County were surveyed. Government-owned and occupied buildings, owner-occupied buildings, medical office buildings and buildings under 20,000 square feet were excluded.