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Economic & Market OverviewUS and Fairfield County
March 1, 2011
2
2
Executive Summary
■The US recession ended in June 2009. –Employment-the key driver of real estate markets bottomed in February 2010.
–The economy has added 1.0 million jobs since then.
–1.3 Million private sector jobs.
–Unemployment rate at 9.0% in January, down from 9.7% a year earlier.
–Employment leading indicators suggest growth is accelerating
■CT/Fairfield Economic Performance
–Waiting for Recovery
■Fairfield Real Estate Market
–Modest improvement
3
3
GDP Growth
-5.0%
-3.0%
-1.0%
1.0%
3.0%
5.0%
1996 1998 2000 2002 2004 2006 2008 2010
Percent Change From a Year Ago
Source: US Bureau of Economic Analysis
4
4
Consumer Spending Growth
-3.0%
-2.0%
-1.0%
0.0%
1.0%
2.0%
3.0%
4.0%
5.0%
6.0%
7.0%
1996 1998 2000 2002 2004 2006 2008 2010
Source: US Bureau of Economic Analysis
Percent Change From a Year Ago
5
5
Business Investment Growth
-25.0%
-20.0%
-15.0%
-10.0%
-5.0%
0.0%
5.0%
10.0%
15.0%
20.0%
1996 1998 2000 2002 2004 2006 2008 2010
Source: US Bureau of Economic Analysis
Percent Change From a Year Ago
6
6
Real Disposable Income Growth
-2.0%
-1.0%
0.0%
1.0%
2.0%
3.0%
4.0%
5.0%
2005 2006 2007 2008 2009 2010 2011
Source: US Bureau of Economic Analysis
Percent Change From a Year Ago
7
University of Michigan Index of Consumer Sentiment
Source: University of Michigan Survey Research Center
50
60
70
80
90
100
110
1980 1982 1984 1986 1988 1990 1992 1994 1996 1998 2000 2002 2004 2006 2008 2010
National Recessions Optimism Confidence
8
University of Michigan Index of Consumer Sentiment
Source: University of Michigan Survey Research Center
50
60
70
80
90
100
110
120
1980 1982 1984 1986 1988 1990 1992 1994 1996 1998 2000 2002 2004 2006 2008 2010
National Recessions Expectations Current Conditions
9
US Unemployment Rate
3.0%
4.0%
5.0%
6.0%
7.0%
8.0%
9.0%
10.0%
11.0%
1960 1964 1968 1972 1976 1980 1984 1988 1992 1996 2000 2004 2008
Per
cen
t o
f L
abo
r F
orc
e
Source: US Bureau of Labor Statistics
10
250,000
300,000
350,000
400,000
450,000
500,000
550,000
600,000
650,000
2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011
National Recessions Strong Employment Market Unemployment Claims
US Weekly Unemployment Claims
11
Profits & Employment
-40.00%
-30.00%
-20.00%
-10.00%
0.00%
10.00%
20.00%
30.00%
40.00%
50.00%19
80
1981
1982
1983
1984
1985
1986
1987
1988
1989
1990
1991
1992
1993
1994
1995
1996
1997
1998
1999
2000
2001
2002
2003
2004
2005
2006
2007
2008
2009
2010
-6.0%
-4.0%
-2.0%
0.0%
2.0%
4.0%
6.0%
Employment Growth (Right) Profit Growth (Left)
12
US Payroll Employment
118,000
123,000
128,000
133,000
138,000
1996 1998 2000 2002 2004 2006 2008 2010
Th
ou
san
ds
of
Per
son
s
Source: US Bureau of Labor Statistics
12/07-2/10 -8.7 Mil.
2/10-1/11 +1.0 Mil.
13
US Private Sector Payroll Employment
95,000
100,000
105,000
110,000
115,000
1996 1998 2000 2002 2004 2006 2008 2010
Th
ou
san
ds
of
Per
son
s
Source: US Bureau of Labor Statistics
12/07-2/10 -8.8 Mil.
2/10-1/11 +1.3 Mil.
14
14
Fairfield County Unemployment Rate
Source: Cushman & Wakefield Research
1.0%
2.0%
3.0%
4.0%
5.0%
6.0%
7.0%
8.0%
9.0%
1990 1992 1994 1996 1998 2000 2002 2004 2006 2008 2010
15
15
Fairfield County Payroll Employment
Source: Cushman & Wakefield Research
360
370
380
390
400
410
420
430
Th
ou
sa
nd
s o
f P
ers
on
s
16
16
Connecticut Payroll Employment
Source: Cushman & Wakefield Research
1,500
1,550
1,600
1,650
1,700
Th
ou
sa
nd
s o
f P
ers
on
s
17
17
Fairfield County Office Using Employment
Source: Cushman & Wakefield Research
100
105
110
115
120
125
130
135
140
Th
ou
sa
nd
s o
f P
ers
on
s
18
18
NYC Employment Financial Services
400
410
420
430
440
450
460
470
480
490
500
1996 1998 2000 2002 2004 2006 2008 2010
Source: US Bureau of Labor Statistics
Th
ou
sa
nd
s o
f P
ers
on
s
19
19
Fairfield County Financial Services
30
32
34
36
38
40
42
44
46
1996 1998 2000 2002 2004 2006 2008 2010
Source: US Bureau of Labor Statistics
Th
ou
sa
nd
s o
f P
ers
on
s
20
20
Fairfield County Manufacturing Employment
32
37
42
47
52
57
62
67
72
77
1990 1992 1994 1996 1998 2000 2002 2004 2006 2008 2010
(Th
ou
san
ds)
21
21
Personal Income Growth: Connecticut vs. US
-5.0%
-3.0%
-1.0%
1.0%
3.0%
5.0%
7.0%
9.0%
2004 2005 2006 2007 2008 2009 2010
CT US
Source: US Bureau of Economic Analysis
Percent Change From a Year Ago
22
22
Fairfield County
Market
Inventory
Dec 2010
Vacancy Rate
Dec 2010
Asking Rent
Dec 2010
Yr-Over-Yr
Rent % Change
Fairfield County 40.9 msf 19.1% $32.24 -3.0 %
Stamford CBD 6.8 msf 23.1% $41.07 -0.4 %
Stamford Suburbs 8.4 msf 22.7% $30.22 -8.3 %
Greenwich 4.3 msf 19.6% $58.06 +4.3 %
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Fairfield County Office MarketNew Leasing Activity
1.8
2.1
3.5
1.2
2.2
3.1
2.8
3.5 3.5
2.8
0.0
0.5
1.0
1.5
2.0
2.5
3.0
3.5
4.0
2001 2002 2003 2004 2005 2006 2007 2008 2009 2010
Mill
ion
s S
F
24
24
19.0%
19.50%
10.0%
12.0%
14.0%
16.0%
18.0%
20.0%
22.0%
24.0%
26.0%
1Q02 1Q03 1Q04 1Q05 1Q06 1Q07 1Q08 1Q09 1Q10
Class A Class B
Fairfield Office Market: Vacancy Rate
25
25
13.70%
10%
15%
20%
25%
30%
35%
40%
45%
1Q02 1Q03 1Q04 1Q05 1Q06 1Q07 1Q08 1Q09 1Q10
Fairfield County Office Market: Sublease as a % of total available space
All Classes
26
26
Overall Asking Rents
Fairfield County Office Market
$34.31
$25.96
$20.00
$25.00
$30.00
$35.00
$40.00
1Q
02
1Q
03
1Q
04
1Q
05
1Q
06
1Q
07
1Q
08
1Q
09
1Q
10
Class A Class B
$/s
f
27
27
$35.
40
$36.
29
$35.
13
$34.
31
$34.
76
$35.
62 $37.
01
$20
$22
$24
$26
$28
$30
$32
$34
$36
$38
1995 1997 1999 2001 2003 2005 2007 2009 2011 2013
PS
F/Y
R
0%
2%
4%
6%
8%
10%
12%
14%
16%
18%
20%
22%
Vac
ancy
Rat
e
Asking Rents
Vacancy Rate
FAIRFIELD COUNTY
CLASS A MARKET FORECAST
FORECAST
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107 Elm StreetFour Stamford Plaza, 8th Floor
Stamford, CT 06902-3851(203) 326-5800
www.cushwake.com
