A strong 2007 seen for office, retail markets
By ALEX PHILIPPIDIS :: December 14, 2006

Next year should shape up to be a strong year for Westchester’s office and retail real estate markets, four veteran real estate professionals said at a luncheon panel talk Thursday.

On the office front, they said, vacancy rates should continue to drop from the current range in the low teens to 12 percent countywide, and well into single digits in downtown White Plains.

William V. Cuddy Jr. of CB Richard Ellis Inc. offered the brightest countywide vacancy forecast for this time next year at 11 percent, followed by 12 percent from John R. McCarthy of Jones Lang LaSalle, 13.5 percent from Brian Carcaterra of Newmark Knight Frank and Glenn P. Walsh of Cushman & Wakefield Inc. at 14 percent.

As for downtown White Plains, Cuddy, McCarthy and Walsh all predicted 7 percent vacancy rate a year from now, while Carcaterra offered a 9 percent projection.

Panelists said they expected a rising demand for Westchester office space and rising rents – especially in downtown White Plains -- as businesses grow and Manhattan rents keep climbing above $100 per square foot. Rising White Plains rents should push some businesses into cheaper alternatives like the office parks along I-287, Cuddy said. Or perhaps, McCarthy said, even the new office space planned for downtown Yonkers as part of the $3 billion parade of projects by SFC Yonkers L.L.C.

Walsh, a longtime leasing agent for Robert P. Weisz, predicted a quick re-leasing of two sites newly available for multi-tenant leasing by Weisz’ RPW Group Inc. – the 620,000-square-foot 1133 Westchester Ave. in White Plains and the 210,000-square-foot 440 Mamaroneck Ave. in Harrison.

Turning to the retail scene, Eric Goldschmidt of Goldschmidt & Associates of Scarsdale expressed optimism due to new mega-projects like the approved $600 million Ridge Hill Village planned for Yonkers. Talk in retail circles has Whole Foods Market possibly opening at Ridge Hill Village, but developer Forest City Ratner Cos. of Brooklyn has only confirmed one tenant to date, a National Amusements Inc. multi-screen movie theater.

“I see it [retail leasing] very strong. There’s a limited amount of space available,” Goldschmidt said. “What retailers and retail owners will suffer more from than anything else is zoning policies in communities. If you have a beauty parlor and you want to convert it to a bank, or the other way around, it’s a change of use. Now all of a sudden it could take a year and a half to two years to get approvals.”

He said Greenburgh has resisted approving new car dealerships despite the availability of suitable space at the former White Plains Honda building. The dealership recently moved from Route 119 (Tarrytown Road) across the town line into the White Plains portion of Central Avenue.

The four professionals were panelists at the Eighth Annual Commercial Real Estate Forecast & Holiday Luncheon presented by the Commercial & Investment Division of the Westchester County Board of Realtors, and held at the board’s White Plains offices.