CBRE'S 1Q TAKE; BACHRACH ON JOBS

A shoutout to great sponsor Jones Lang LaSalle, whose New York project and development services group just completed the $16M renovation of the historic Beacon Theatre. Client Madison Square Garden tapped JLL to oversee the restoration; the team included Beyer Blinder Belle and Lehr Construction.
We love research reports and free food, so we dropped by CB Richard Ellis' MetLife Building office yesterday morning for a quarterly market review. CBRE Econometric Advisors' Jim Costello and New York Tri-state Region chair John Powers informed us, overall, Manhattan office continues to deteriorate with rental declines, increased space, and decreased absorption.
Sublease space continues its impact but less severely than numbers suggest, John, right, says, as short lease terms and space size make 7M of 10M SF in Manhattan unleasable. There's been dramatic re-pricing, with 8.2M SF of Midtown offices experiencing 1Q rental declines; some 30M SF in Manhattan have priced downward already. Although job loss will continue into '12, Jim says recovery will come when personal consumption/savings/investment grow, corporate profits/production increases, hiring demand grows, and financial services employment trends positively.
We bumped into two of CBRE's hardest working landlord and tenant reps, Peter Turchin and Paul Myers. Peter tells us he's been busy with corporate dispositions, including helping Boston Properties with the space left by Lehman Brothers at 399 Park. Paul just returned from a golfing and family vacation in Pinehurst, NC (sounds better than the short burst of snow we had yesterday).

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