Sutton & Edwards Sees Average Class-A Office Rents Topping $30

Average asking rents for Class A space on Long Island, NY will pierce the $30 mark in 2006, the commercial real estate services firm Sutton & Edwards Inc./TCN Wordwide forecasts. The firm also reported a drop off in fourth-quarter office vacancies.

LAKE SUCCESS, NY (PRWEB) January 18, 2006 -- The average asking rent for vacant Class-A office space on Long Island averaged just under $30 a square foot in the final quarter of 2005 and is poised to pierce that magical barrier sometime this year, Sutton & Edwards Inc. / TCN Worldwide, Long Island’s leading commercial real estate services firm, reported.

“It’s not a question of if, but in which quarter of 2006 will it pierce that mythical ceiling?” said Alan Rosenberg, President of Sutton & Edwards.

The overall asking rent for Class-A space — space in the newest buildings with the best locations and amenities — averaged $28.44 per square foot in the fourth quarter of 2005, slightly higher than the previous quarter’s $28.37, but sharply above the $27.01 averaging asking rent recorded at the end of 2004..

In Nassau County, the Class A asking rent was $29.94 per square foot at the end of the final quarter of 2005, continuing a year-long upward trend. In the third quarter, asking rents averaged $29.68. A year ago, asking rent in the county averaged $28.28

In Suffolk County, the Class A average asking rent averaged $25.43, down a penny from the prior quarter, but almost a dollar more than the $24.46 a year earlier.

The rise in office rents has taken place against a backdrop of declining Class-A office vacancies, Islandwide and in each county.

Across Long Island, the Class-A office vacancy rate at yearend stood at 8.34 percent, compared with 9.68 percent at the end of the third quarter and the 2004 fourth-quarter figure, 8.97 percent.

“Long Island has shown a remarkable ability to maintain the delicate balance between product and users which creates a stable real estate environment,” said Sutton & Edwards Chief Executive Officer Herb Agin.

The Class-A vacancy rate for Nassau was 8.6 percent at the end of 2005, compared with 9.48 percent at the end of third quarter, but above the 7.1 percent one year earlier. Almost 300,000 square feet of new office space came onto the Nassau market during 2005, but a considerable portion of available space at 135 Crossways Park Dr., Woodbury, and 300 Jericho Quadrangle, Jericho, was leased during the final quarter.

In Suffolk, the Class-A vacancy rate was 7.8 percent at the end of 2005, compared with 10.05 percent in the third quarter and 12.46 percent at the end of 2004. In Suffolk, the drop reflected a reclassification of a large property, the 260,000-square-foot 5000 Corporate Court in Holtsville, from Class A to Class B status during the most recent quarter.

The vacancy rate for both Class A and B office space Islandwide was 10.33 percent at yearend, compared with 9.06 percent a year earlier. In Nassau, 245,571 square feet of Class B office space at 100 Duffy Ave., became available with the departure of JP Morgan Chase and the sale of the bank’s vacant, former back office building to Apollo Real Estate Partners.

About Sutton & Edwards Inc.

Founded in 1962, Sutton & Edwards Inc. / TCN Worldwide is Long Island’s premier commercial real estate services firm. Headquartered in Lake Success, NY, the firm employs 48 real estate specialists providing integrated leasing, investment sales, property management and advisory solutions. To find out more about Sutton & Edwards, please call 1-516-328-6500, or visit the firm's Web site at www.suttonandedwards.com.

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