THE WORLD READS WHITE PLAINS CITIZENETREPORTER — 8,324,077 VISITS IN ONE YEAR

 

 

WPCNR POTOMAC POST. By John F. Bailey. July 7, 2009: Congressman Barney Frank and Congresswoman Maxine Waters asked Housing and Urban Development Secretary Shaun Donovan in a letter dated June 15,  to place a “one year moratorium on the approval of applications for the demolition or disposition of public housing units.”

 

 

Frank and Waters in their letter to Mr. Donovan, ask no approvals for future demolitions should be made  “until such time as housing authorities are required to replace demolished or disposed units on a one-for-one basis, we risk losing the crucial investment and significant asset these units represent,”

 

It is not clear how this would affect White Plains Housing Authority ability to obtain  immediate HUD HOPE VI funds,  grants or any of the $4 Billion in American Recovery and Reinvestment Act funs for the Winbrook replacement project that the council in essence approved last night, in effect, by approving the zoning for the project. Executive Director Mack Carter did not specify “a laundry list” of funding sources the White Plains Housing Authority was going to pursue last night and was not pressed for a timetable by the Council, or for what he expected to raise.

 

The White Plains Housing Authority proposes do just that,replace units one for one. But it is unclear what effect, if any, the Frank-Waters request of Secretary Donovan will have. WPCNR will check with Mr. Frank’s office and HUD. 

 

It was obvious from Mr.Carter’s remarks that the Housing Authority does not have any requests for approval on HUD’s desk, so if there is going to be a moratorium by HUD on such approvals, the Housing Authority is perhaps overly optimistic in how soon funding could be secured. Again, the Council did not ask for details on the Housing Authority plans.

 

WPCNR was advised of this by a housing executive just today, and though Councilman Roach was informed of the effort by the influential Mr. Frank and Ms.Waters, he chose not to mention it at this evening’s meeting as a possible reason to delay the vote of the zoning.

 

The existence of the suggested halt in new demolition projects was not mentioned by  White Plains Housing Authority Counsel or Housing Authority Executive Director Mack Carter, but perhaps they did not know about it.

 

If Applications approvals are halted for one year, it is unclear how this affects the project ability to fund itself. Carter did not say how much money the Housing Authority needed to do the paperwork to apply for the unspecified grants, other than Hope VI grants. He was not asked by the Common Council either how much he needed.

 

For members of the Common Council, and whoever would like to read the letter from Mr. Frank and Ms.Waters in its entirety, go to http://www.ntic-us.org/images/HJM/waters%20%26%20frank%20moratorium%20letter.pdf

WPCNR HALO WATCH. From Cushman & Wakefield. July 6,2009(EDITED): In the White Plains Central Business District (CBD), direct asking rents declined in April, May and June, registering $32.32 psf, a decrease from the $34.53 psf last quarter and $35.55 psf one year ago.  The White Plains Non-CBD direct asking rents averaged $32.28 psf, a slight decrease from $32.34 psf last quarter but an increase from $31.77 psf one year ago.

 

Cushman & Wakefield reported the Westchester County commercial real estate market showed a continued decrease in key indicators across the county.  Class-A leasing activity, however, increased this quarter — totaling approximately 234,019 square feet (sf), up from 100,746 sf last quarter. This increase is due primarily to one tenant lease.

 

 

A total of 408,040 sf of space was added to the market inventory this quarter, a 27% increase over the 319,933 sf added last quarter.  More than half of the space added (206,081 sf) to the vacancy this quarter was sublease space.

 

The overall Class-A space available in the county rose to more than 4.4 million sf (msf) in the second quarter, a slight increase from 4.2 msf last quarter and a jump from the 3.6 msf this time last year.  Of that available space, more than 920,000 sf is sublease space.  Sublease space represents more than 53% of the available space that’s been added to the market since this time last year. 

 

Overall vacancies continued to increase countywide with the vacancy rate for Class-A space registering at 20.6%, an increase from 19.4% last quarter and a substantial rise from the 16.7% vacancy rate of one year ago.  These increases, reflecting the national real estate trend, were primarily due to the increase in sublease space returned to the market from such tenants as Alliance Bernstein for 94,693 sf, Pernod Ricard for 33,263 sf and GFK Custom Research for 24,000 sf.

 

“Commercial real estate traditionally lags behind and reflects the economy, so it’s no surprise that we’re still dealing with a difficult market,” said Jim Fagan, senior managing director and head of Cushman & Wakefield’s Fairfield and Westchester County region.  “While the market is still in the midst of a storm as tenants downsize their space needs and leasing activity slows, there are several large tenants — possibly as many as ten — that are choosing this time and environment to acquire additional space.”

 

Direct asking rents for Class-A space countywide at the close of the second quarter averaged $31.29 per square foot (psf), down from $31.96 psf last quarter and $32.13 psf one year ago.  Although asking rents remain fairly stable, they are not reflective of actual taking rents, which have decreased substantially, especially when combined with the ever-increasing landlord concessions.

Overall absorption for Class-A space in the county in the second quarter totaled negative 231,629 sf, compared with negative 371,343 sf absorbed last quarter and negative 206,213 in second quarter 2008.

 

Major transactions that occurred during the second quarter included the 114,940-sf lease signed by Transamerica Financial at 440 Mamaroneck Avenue in Harrison and Westchester Medical’s lease for 31,631 sf at 2700 Westchester Avenue in Purchase.

 

Mr. Fagan said, “Financially stable landlords own most of the major office buildings in the county.  Because of that, Westchester County should not go through wholesale re-trading the way we did in the early 1990s.  I have confidence in this market — it’s fundamentally sound.” 

 

WESTCHESTER COUNTY ECONOMY

 

Westchester County has experienced slightly less job loss than the nation as a whole; with an unemployment rate in May 2009 at 7.0% (June data is not yet available), well below the national average at 9.4%.  (National unemployment rose slightly to 9.5 %, however, statistics are not yet available for Westchester County.)  The county continues to experience weakness related to the concentration of corporate offices, as many companies have been shedding white collar jobs. While continuing to shed jobs, Westchester appears to be in somewhat better shape than the rest of the country.  Overall, we expect Westchester to track national trends because of its diversified industry and employment base and reach a trough in employment during the second half of 2009 before recovering in 2010. 

 

INVESTMENT SALES

The investment sales market remained stagnant registering only one sale for the quarter; 425 South Broadway in Tarrytown at $2.5 million or $59/sf.

 

Mr. Fagan added, “The investment markets have, and will continue to be, extremely slow predominately due to three factors: (1) credit markets remain very tight as lenders, not sure which direction the commercial real estate market is heading, increase the covenants needed to complete a loan; (2) sellers who do not have to sell will not sell into a devalued market; and (3) sellers who have to sell, often times can’t if they have too much leverage on the properties.  We see this as a cyclical trend that will improve over time.”