| Our Magic 8-Ball keeps telling us “Reply hazy, try again later,” so we dropped by CresaPartners’ tenant guru Bob Stella, on Park Ave, to get some real office predictions. Good news: He didn’t need a toy. Bad news: We haven't hit bottom yet, although space is being offloaded at a slower pace and unemployment has started a decline. |
| Expect the bottom in six months to a year, he estimates, and we may sit there for a while. Even with the stimulus package, tenants are slowly coming out of the wait-and-see mode. They're becoming more concerned about landlord credit, as some are going into default; some want guarantees that money for improvements will be set aside and that leases include certain protections. Another tenant concern is efficiency; corporations are looking at more efficient space, getting rid of luxuries like personal gyms (look for more copier machine-based calisthenics?), and putting more people into fewer SF. Those in the workplace solutions biz: “Outlook good.” |
| The good news is that the bad news has slowed, the stock market is looking positive, and new office supply has decelerated. Now is the time for tenants to act, especially for quality and flexibility; major tenants also have more power to renegotiate early, he notes. In the meantime, Bob's taking the dog days to do some boating at Candlewood Lake—that is, in between the raindrops. |
OFFICE! HOSPITALITY! CHARITY!
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