Posted By thestatedtruth.com on March 30, 2010

March 30 (Bloomberg) — Downtown Manhattan, where demand for office space began to surge three years after the 9/11 terrorist attacks, is about to lose its spot as the best- performing U.S. market.

Vacancies may exceed 14 percent of the area’s 87 million square feet by late 2011, empty space that’s equivalent to four Empire State Buildings and the highest rate since 1997, according to property broker Cushman & Wakefield Inc. That doesn’t include the 4.4 million square feet of offices in two towers now under construction at the World Trade Center site. Those are scheduled for completion in 2013.

“The amount of space that’s potentially going to come to the market will increase availabilities and put pressure on pricing,” said Kenneth McCarthy, Cushman’s head of New York- area research. “It will be quite awhile before it can be absorbed.”

Lower Manhattan, dominated by financial firms, withstood the commercial property slump better than any other U.S. business district, with more than 90 percent of offices occupied at the end of last year even as the city lost 67,500 jobs in the 12 months through December. Now open space is rising faster than demand, as Goldman Sachs Group Inc. moves into its new downtown building, American International Group Inc. relocates its headquarters, and Bank of America Corp. shifts operations to its new tower in Midtown.

More at…http://www.bloomberg.com/apps/news?pid=20601109&sid=a3NKXZe6aJPE&pos=11

Categories: Commentary, Economy, Finance, National News, Real Estate, Wall Street
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