NEW HAVEN, Conn., March 12, 2008 — The New Haven office market, which consists of Fairfield and New Haven counties, has successfully drawn tenants from nearby New York City, but office properties in the region will operate in a less hospitable climate in 2008, according to the 2008 National Office Report by Marcus & Millichap, the nation’s largest real estate investment services firm. Additional upward pressure on vacancy could arise if a significant downsizing in the counties’ large financial activities sector occurs.
Also included in the report is the firm’s annual National Office Index (NOI), a snapshot analysis that ranks 43 office markets based on a series of 12-month forward-looking supply and demand indicators. New Haven moves down six places this year to No. 43.
“Local properties have remained popular with investors, although some price adjustments may occur in the months ahead,” says Edward Jordan, regional manager of Marcus & Millichap’s New Haven office.
Following are some of the most significant aspects of the New Haven Office Research Report:
Total employment in New Haven and Fairfield counties is expected to rise 0.6 percent this year, or by 5,300 workers.
In 2008, 650,000 square feet of new for-lease space is scheduled for delivery.
Vacancy is forecast to end the year at 14.9 percent.
Asking rents are expected to rise 2.6 percent to $31.03 per square foot, while effective rents will gain 2.3 percent to $27.17 per square foot.
Investors put off by relatively higher property prices in Fairfield County may find solid value in Class B/C properties along the Interstate 91 corridor in New Haven County.
In the 2008 NOI, Seattle moved up three places to secure the No. 1 spot, surpassing last year’s leader New York City, which slipped to No. 2. Boston moved up two spots to No. 3, while San Francisco jumped 12 places to the No. 4 position. Los Angeles slipped two spots, coming in at No. 5.
For a copy of Marcus & Millichap’s National Office Report and the complete NOI rankings, visit www.MarcusMillichap.com.
With more than 1,300 investment professionals in offices nationwide, Encino, Calif.-based Marcus & Millichap Real Estate Investment Services is the largest commercial real estate brokerage in the nation focusing exclusively on real estate investments. In 2007, the firm closed $20.7 billion in transactions. Founded in 1971, the firm has perfected a powerful system for marketing properties that combines product specialization; local market expertise; the industry’s most comprehensive research and analysis capabilities; state-of-the-art technology; and established relationships with the largest pool of qualified investors nationally.