2018 Connecticut & Westchester County Mid-Year Review

2018

CONTENTS:

mid-year review

Recent Sales

Connecticut &

About UMF

Westchester County

Market Overview

Who We are Since its inception in 1998, UMF has successfully completed 1,200 transactions of investment properties resulting in $1.8 Billion in total investment sales. With direct experience in the acquisition, management, development and finance of investment properties, the UMF team is supported by the latest marketing technology, sophisticated market research, and comprehensive training.

UMF Analysts and Associates apply their varied experiences in real estate, with their extensive knowledge of local and national investment trends, to a pricing and disposition strategy that yields the highest maximum value for clients.

our deal management We CREATE a due diligence file with all relevant property and financial data. This helps us speed up the due diligence process by providing investors information up front making the timeline of the sale much easier for all parties involved.​We do all of this while working with only the most qualified investors and doing it in a manner that ensures no tenants and/or staff find out about the sale until the deal is closed.

Rich Cawley

Matt Cawley

Kurt Cawley

President

Senior Director

Senior Director

617.529.1141

917.946.5425

617.875.1073

rcawley@umf.com

mcawley@umf.com

kcawley@umf.com

Multifamily, Commercial:

Multifamily: Westchester County

Multifamily, Commercial:

Connecticut

NY, Fairfield County CT

Connecticut

how we market To get you the highest price we do things the right way. We spend the time and money to present your property in the best possible way.

we brand

we Maximize

we feature

each property we market with it’s

exposure by utilizing regional trade

your property on our website and

own unique landing page and custom

journal advertising and provide

create an individualized email blast

domain. Our deals are marketed with

additional deal exposure to millions

which goes out to our proprietary list

drone/professional imagery and full

of investors nationwide through the

of 10,000+ investors.

marketing brochures.

most popular commercial real estate sites including Loopnet & CoStar.

E-blast

Interested in selling your property?

Want to get the highest possible price in the shortest period of time?

To find out what your property could sell for in today’s market and how we would market your property please contact Rich Cawley at 617-529-1141 or email rcawley@umf.com.

Landing Page

2018 Mid-Year Review

CT & WESTCHESTER COUntY MULTIFAMILY Sales volume

Westchester $280,976,439

# of Transactions

Avg. Cap Rate

Avg. Price PSF

Avg. Price Per Unit

Hartford

18

8.1%

$144

$142,277

New Haven

14

8.7%

$127

$112,249

New London

8

9.4%

$108

$87,987

Fairfield County

8

7.2%

$140

$139,457

Westchester

16

6.7%

$218

$240,539

Total/Avg.

64

7.7%

$154

$160,511

Hartford $145,109,518 New Haven $198,944,714

Fairfield $120,691,000

New London $47,109,286

Hartford has among the lowest rents of any major New England metro and time will tell how the State’s Capital will respond to the $550M taxpayer bailout received earlier this year. While new development plans for parts of Downtown Hartford hope to spark revitalization, the city must attract new employers to drive demand for quality housing options. For the New Haven multi-family market, 2017 and the first half 2018 were very strong, with record numbers in both volume and pricing. A large portion of the attractive housing stock is concentrated around Yale University, and rightfully so as the university remains a key element in most new developments in the city. The New London multi-family market continues to reap the benefits of General Dynamic Electric Boat’s new government contract, as new high-earning renters are coming into the market. While traditionally a homeowners’ market, Fairfield County is transforming with a

massive amount of apartment rental building deliveries aiding inventory growth of more than 60% since 2010 in Stamford alone.

A growing millennial population in the county has increased demand for quality new housing being constructed. Westchester County, which remains one of the most expensive counties to live in the country, is seeing new development projects in areas that historically haven’t seen much development. Downtown New Rochelle is undergoing a revitalized master development with RXR Realty named “Master Developer” to transform the historic downtown area. In addition, the Yonkers waterfront is seeing the largest building boom in it’s history with currently 1,000 new rentals in various stages of development.

Market Indicators

Units Under Construction

$2,500 $2,000 $1,500

5.5% 4.3%

4.5%

6.0% 5.3%

5.0% 3.5%

$1,000 $2,022

New London Average Rent/ SF

Hartford New Haven

$2,047

$1,105

$1,307

$0

$1,235

$500

Fairfield Westchester County County Vacancy Rate

Copyright 2018 United Multi Family│Data Provided by CoStar

Westchester County 4,006

Hartford 1,677

4.0% 3.0% 2.0%

New Haven 697

1.0% 0.0% Fairfield County 2,324

2018 Mid-Year Review

CT & WESTCHESTER COUntY office Sales volume # of Transactions

Avg. Cap Rate

Avg. Price PSF

Hartford

7

8.6%

$55

New Haven

9

10.2%

$84

New London

1

n/a

$18

Fairfield County

16

7.4%

$162

Westchester

13

8.7%

$110

Total/Avg.

46

9.8%

$113

Hartford $19,020,000 New Haven $19,982,650 New London $493,284 Westchester $142,425,000 Fairfield $229,576,250

While vacancy rates in Hartford remain high there is reason for optimism in this sector. The city’s economy has shifted from one focused on the financial services industry to now relying on healthcare and other business-related services. As companies target Hartford for new space look for these two industries to lead the bulk of the office space lease-up. New Haven’s office market is primarily based on the education and health services industry, as close to one third of all the areas employment comes from these sectors. Like other parts of the state, New Haven too has taken blows from major corporations leaving the area as Alexion Pharmaceuticals decided to move its headquarters to Boston. The Fairfield County office market, which has historically focused on the financial services, is in diversification mode as the area prepares to lease-up the space occupied prior by financial sector tenants that have since moved. The area, specifically Stamford

Central Business District, has struggled with these departures with vacancies shooting up as high as 15%. The mid-year investment sales market was highlighted by Rubenstein Partners acquisition of Shippan Landing, a 770,000 square foot facility in Stamford’s waterfront, for approximately $147MM. The most active sections of the Westchester County market run along the I-287 Corridor with the larger space requiring tenants being located to the east, and the smaller more suburban style tenants being concentrated in the west. Major sales in the first half of 2018 include Ginsburg Development’s acquisition of the Westchester Financial Center for $83MM. The firm has plans to redevelop the facilities into a mixed-use complex.

Market Indicators

SF Under Construction

$40.00

15.0% 12.8%

$30.00 $20.00

7.7%

6.5% $26.09

New London Average Rent/ SF

Hartford New Haven

$32.32

$19.62

$20.59

$0.00

10.0% 8.3% $18.52

$10.00

11.9%

Fairfield County 92,443

Fairfield Westchester County County Vacancy Rate

Copyright 2018 United Multi Family│Data Provided by CoStar

5.0% 0.0% New Haven 41,400

Hartford 271,000

2018 Mid-Year Review

CT & WESTCHESTER COUntY retail Sales volume # of Transactions

Avg. Cap Rate

Avg. Price PSF

Hartford

14

7.6%

$142

New Haven

12

6.8%

$178

New London

6

7.3%

$37

Fairfield County

15

7.2%

$292

Westchester

21

6.4%

$271

Total/Avg.

68

6.9%

$203

Hartford

$48,992,677

Westchester $118,382,000

New Haven $76,369,818

Fairfield $72,910,600 New London $2,417,916 In the Hartford metro retail market a lack of new supply coupled with strong leasing throughout 2015 and 2016 have kept the vacancy rate low and it currently sits just under 100 basis points below the 10 year average for the metro area. One particularly active tenant is REI who in recent years has added over 20 locations in the metro area. Many health and fitness oriented retailers have fared well here too. New Haven is experiencing its lowest vacancy rate in decades, but demographics here are limiting overall growth.

Demographic issues in this market stem from virtually zero new residents over the past 10 years and only 15% of the population being in the top spending category which is 35 to 54 year olds.

Sales volume has been particularly slow in the New London metro area in recent years and that trend has continued through mid-year 2018, although vacancies remain tight in this metro market. Fairfield County’s new retail development is mostly

located in Norwalk and Bridgeport, where Steelpointe Harbor is transforming the city’s waterfront. Stamford has ranked near the bottom of the top 54 metros in development, with about 2 million SF constructed here since 2010, but has an extremely stable vacancy rate, which currently sits at 3.2%. Major sales in the first half of 2018 were highlighted by Asana Partners purchase of 13651391 Post Road East in Westport, CT for $28MM. The majority of existing and under construction retail inventory in Westchester County is situated in the Southeast and Southwest submarkets.

These submarkets are split down the middle by the Bronx River Parkway and share a border with the Bronx to the south and White Plains to the north. One notable trade from the first half of 2018 in this market was Regency Centers’ purchase of the 116,422 SF Rivertownes Square for $68.9M – just shy of $600/SF.

Market Indicators

SF Under Construction 6.0%

$40.00 $30.00

4.4%

4.0%

$28.84

New London Average Rent/ SF

Hartford New Haven

3.2% $29.10

$13.58

$16.31

$16.51

$0.00

3.4%

3.8%

Fairfield Westchester County County Vacancy Rate

Copyright 2018 United Multi Family│Data Provided by CoStar

Hartford 401,000 New Haven 70,200

5.0%

4.9%

$20.00 $10.00

Westchester County 338,930

3.0% 2.0%

New London 3,500

1.0% 0.0% Fairfield County 1,660,618

z

2018 Mid-Year Review

sold and for sale by UMF

SOLD Bridgeport, ct 462 Units $30,540,000

FOr sale Rye, NY 103 Unit Ground Lease $19,000,000

Interested in learning more about these transactions? Contact Matt Cawley at 917-946-5425 or mcawley@umf.com.​ z

Interested in selling your property?

To find out what your property could sell for in today’s market and how we would property please Rich Cawley at Contact Mattmarket Cawleyyour at 917-946-5425 orcontact mcawley@umf.com.

617-529-1141 or email rcawley@umf.com.

Rich Cawley

Matt Cawley

Kurt Cawley

President

Senior Director

Senior Director

617.529.1141

917.946.5425

617.875.1073

rcawley@umf.com

mcawley@umf.com

kcawley@umf.com

Multifamily, Commercial:

Multifamily: Westchester County

Multifamily, Commercial:

Connecticut

NY, Fairfield County CT

Connecticut

2018 mid-year review Connecticut & Westchester County