Fairfield County: Office Market Demand Analysis

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The Objective

• The objective of our Fairfield County analysis is
  to provide insight to this markets direction
  over the next 7 10 years.
• We will explore the factors affecting the office
  markets supply demand via a demand analysis.

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Demand Analysis- Ingredients

• Supply
• Vacancy
• Job Growth
• Space Additions

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History

• Fundamental Transformation
• Corporate HQ Small-Midsize Office
• Reflecting New Employment Patterns Driven by
• Globalization
• Technology

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Fairfield County- Historically

• Square Footage Additions

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Fairfield County- Historically

• Geographic Square Footage Additions

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Fairfield County- Historically

• Vacancy Rates

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Fairfield County- Today

• Vacancy Rates

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Fairfield County- Today
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Institutional Investment Fundamentals

• Limited product to satisfy institutional
• underwriting criteria caused by
• Fierce Acquisition Competition
• High Prices
• Poor Market Fundamentals

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Non-Institutional Investment Fundamentals

• Players Abound
• Largely Undeterred by Poor Fundamentals
• Looking for Control
• Often Limited Backgrounds
• Leverage- Key element in winning deals

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Overall Real Estate Fundamentals

• Generally Positive for All Forms of Real Estate
• Economy Showing Signs of Sustained Growth
• Corporate Profits and Household Incomes Continue
  to Improve

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Projected County Employment Growth

• Rate by Period

Source The Connecticut Center for Economic
Analysis
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Periodic County Employment Growth
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Fairfield County Pipeline

• Approximately 5.3 million square feet of office
  space have a reasonable expectation of coming
  online over the next 7 years.

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Fairfield County Pipeline
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Forecasted County Vacancy Rates
Vacancy Rates with no space additions to the
market
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Forecasted County Vacancy Rates
Now add the proposed space additions in Norwalk
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Forecasted County Vacancy Rates
Now add the proposed space additions in Norwalk
Fairfield
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Forecasted County Vacancy Rates
Now add the proposed space additions in Norwalk,
Fairfield Stamford
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Forecasted County Vacancy Rates
Now add the proposed space additions in Norwalk,
Fairfield, Stamford Danbury
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Forecasted County Vacancy Rates
Now add the proposed space additions in Norwalk,
Fairfield, Stamford, Danbury Shelton
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Forecasted County Vacancy Rates
Now add the proposed space additions in All of
Fairfield County
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Challenges

• Be Aware of What is Happening Next Door
• Establish Market Controls
• Risk of Overextended Infrastructure
• Positive note were only human

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Conclusions Opportunities

• In All Change Comes Opportunities
• Follow the herd - Continued Eastward Movement
• Ride the Wave - Flexible offices catering to both
  the larger and smaller office user
• Long Term - Emerging Outer beltway Around
  Manhattan Rt 8 to I-84 to I-87 to I-287

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