Activity is expected to pick up throughout Fairfield County’s commercial real estate market, including Stamford, where space is available in this downtown office building at 1351 Washington Plaza.

The commercial real estate market in Fairfield County is cyclical, and if Scott Benson, president of Benson Commercial Realty, is right, the market is poised for an increase in activity.

“We’re starting to see the trickle effect,” he said.

According to Benson, whose company has offices in Stamford and Tarrytown, N.Y., activity in Manhattan has picked up, pushing up some rents and leading to a reduction in concessions there. Markets in Connecticut’s Fairfield County and other New York City suburbs like Westchester County and Jersey City have long been recipients of companies that find Manhattan too expensive, and Benson said he expects that trend to continue and strengthen in the near future.

“At present, there is a great deal of activity in both [Fairfield and Westchester] counties [that’s] in incubation stages or due to close shortly,” Benson wrote in a recent report. “As the New York City market continues to show a strong resurgence, and the effectuated rental rates continue to escalate, with the only presently weak sector being the downtown area, my prediction is that Westchester and Fairfield can anticipate one of the greatest absorption periods since the early to mid-1980s.”

Fairfield County – including the long-troubled Stamford market – could get a fair amount of relocations, Benson said.

“We have limited inventory in Westchester County,” he said.

That could lead to relocating companies that are looking for larger blocks of space moving to Fairfield County – although large blocks are somewhat limited, as well.

‘A Little Edge’

Stamford, which lately has been hurt as companies have relocated east to Norwalk, first took off as a hub for financial institutions in the 1980s and 1990s. Companies started moving from New York City to escape high rents, first to Greenwich, and then to Stamford, Hallock said. Construction was taking place everywhere in Stamford and the city prospered. Companies that wanted to move there in the late 1990s couldn’t find space.

But then prices started to go up. Housing became expensive, so many of the workers at those companies started moving farther east, to towns like Shelton and Trumbull, where housing was cheaper.

And when companies wanted to expand or move to different facilities, they decided to spare their employees the rush-hour headaches they were experiencing on Interstate 95, and moved farther east. Some large companies, such as Diageo PLC and FactSet Research Systems, moved from Stamford early last year.

But Stamford might be set for a comeback. Its downtown is attractive, with newer buildings and better transportation than a place like White Plains, N.Y., Benson said.

“Stamford does have a little edge on the downtown area of White Plains,” he said. “[Stamford] does have a good downtown environment”

Benson said he expects to see more financially oriented companies moving to Stamford, while Norwalk will continue its good luck as more service-oriented companies move there.

But not all commercial real estate agents agree.

Al Mirin, a first vice president at CB Richard Ellis in Stamford, said he doesn’t think that relocations will pick up much in the near future, at least not universally.

“You can’t make Fairfield County blanket statements like that,” he said.

But Mirin added that he believes the county could see some expansion from companies that have locations in both New York City and in Fairfield County. Many employees of New York firms live in Connecticut, so expanding in Fairfield County gives companies the chance to be closer to their employees while enjoying the cheaper rents in the suburbs. But a presence in New York City is important for many firms to maintain.

Nonetheless, the commercial real estate market in Fairfield County and other suburbs in Westchester County and New Jersey is tied to New York City’s, and all have benefited from some relocations.

“This community is tied to the New York economy,” Mirin said.

But Benson believes some mid-sized companies that occupy between 10,000 and 25,000 square feet might be the most primed to move. Companies that size could save millions of dollars over a decade with a relocation to a suburb like Fairfield County, he said.

“It could be enormous [savings],” Benson said.

The markets in Fairfield County and other suburbs are also in good shape to support relocations.

“Both Westchester and Fairfield counties have shown minimal volatility in their overall vacancy rates,” according to Benson’s report. “Most interesting is that both markets have shown no greater than a 2 percent fluctuation in occupancy level (for over 3,000 buildings exceeding 25,000 square feet comprising approximately 120 million square feet), with the exception of the central White Plains business district.

“At present, Fairfield County, with over 70 million feet of office space, reflects close to a 15 percent vacancy rate, while Stamford’s central business district is at its two-year high of approximately 14 percent to 14.5 percent since the fourth quarter of 2003. The greatest constant over the last two years has been reflected in the sublease or second-tier space market,” Benson wrote. “Both counties have shown only a 1 percent movement with Fairfield presently at approximately 3 percent to 3.5 percent and Westchester at 2 percent.”

The improvement for Fairfield County will likely start soon, Benson said.

“I think Fairfield County will see this immediately,” he said. “I only see great positives coming around the corner.”