‘The town is just alive’: As Interest Grows, Cost of Westport Office Space Soars


WESTPORT — With a downtown office building garnering a sale price well in excess of its appraised value, the Darien developer that owned it has listed its two other Westport offices for sale.

Both offices at 355 Riverside Ave. and 285 Riverside overlook a scenic run of the Saugatuck River between downtown Westport and Interstate 95. At more than 50,000 square feet of space, the brick building at 285 Riverside Ave. is the third largest in southwestern Connecticut listed for sale on the Loopnet commercial real estate website, after a Milford office campus and a Stamford office building.

Owned and managed by Baywater Properties, the Westport buildings are divvied up for multiple commercial tenants. The smaller building at 355 Riverside Ave. was once used as a back-office operation by Bridgewater Associates, the world’s largest hedge fund whose headquarters is a few miles north.

Baywater has yet to disclose the prices it is seeking for the Westport buildings in online listings through the commercial real estate brokerage CBRE.

A Baywater office at 450 Post Road E. recently sold for $15 million, 60 percent more than its most recent appraised value by the town of Westport in 2020. The building is leased to Wells Fargo Advisors, next door to a Wells Fargo bank branch and a Trader Joe’s market.

Baywater is gearing up for the Corbin District redevelopment of downtown Darien, which will replace nearly a dozen buildings with a new village center spanning retail, apartments and boutique offices.

Demand for office space remains a guessing game for many, as companies keep remote working arrangements in place that have proven effective for many since the start of the COVID-19 pandemic.

As of the third quarter, more than 12 million square feet of office space was available for lease in Fairfield County, according to the Stamford office of Cushman & Wakefield, a 32 percent vacancy rate. That compared to a vacancy rate of below 27 percent two years earlier.

But buyers continue to bet on either a comeback in office leasing or the possibility of converting properties to other uses. In August, the former Conde Nast building on East Putnam Avenue in Greenwich sold for $63.5 million, equating to $340 a square foot.

On paper, Westport office rental rates are down only 1.3 percent from their average of two years ago as calculated by Cushman & Wakefield, but commercial property owners have been offering perks like a few months of free rent at the start of a lease.

That has created opportunities for tenants that may have been priced out of the market before 2020 to give Westport another look, according to David Waldman, principal of David Adam Realty. The town had a large influx of new residents during the COVID-19 pandemic, providing a revival.

“It has enabled other people to come in and occupy space,” Waldman said. “The town is just alive.”