Office properties near transit hubs including the Stamford Transportation Center have attracted the most demand in recent years, but the trend reversed itself in the first quarter. (Courtesy Photo / CC BY-SA 4.0 / John9474)
In a sluggish quarter of office leasing activity in Fairfield County, suburban properties outperformed their downtown counterparts in attracting and retaining tenants.
The county-wide vacancy rate rose 1 percent to 27.2 percent, CBRE reported, during the first quarter.
“Fairfield County started 2024 slowly from a demand standpoint and continues to grapple with elevated supply in the market,” CBRE researchers stated in the brokerage’s first-quarter office report.
The county’s 39.5 million-square-foot office market recorded 159,214 square feet of negative absorption during the quarter. Tenants committed to 350,109 square feet of new leases and renewals, a 13 percent decline from the five-year quarterly average and the slowest start to a year since 2020.
Recent leasing activity represents a departure from recent years in which properties near transportation hubs have garnered the most demand. Nearly three-quarters of all leasing activity during the quarter took place outside of central business districts, according to CBRE data.
The Fairfield East market attracted the most leasing activity totaling 130,000 square feet, including LightBox’s commitment to 21,114 square feet at 6 Armstrong Road.
By contrast, the county’s largest submarket, Stamford’s 10.1 million-square-foot downtown business district, recorded just 65,000 square feet of leasing activity, the lowest figure in nearly four years.
The county’s highest-rent district, the 2.1 million-square-foot downtown Greenwich submarket, has the lowest vacancy rate at 9.9 percent with average asking rents of $110.30 per square foot. The market’s continued desirability was reflected by 96,000 square feet of renewals, the highest of any submarket in Fairfield County, including Horseneck Capital’s 43,000-square-foot renewal at 20 Horseneck Lane.
The countywide asking rent average was flat at $35.38 per square foot, ranging from $110.30 per square foot in downtown Greenwich to just under $20 per square foot in the North and East submarkets.
Sublease listings still represent a major source of availabilities, representing 19.8 percent of all available space in Fairfield County, CBRE reported.
