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Even If Vacancies Doubled, Rate Would Still Be Significantly Less than Normal

NEW YORK CITY-Corporate managing director for Julien J. Studley L. Craig Lemle tells GlobeSt.com that even with dot-com failures this is still a very strong owners' market.

By Amy Vaughn | Updated on January 11, 2001

NEW YORK CITY-With growing concern over the impact so many dot-com failures could have on the office market growing, GlobeSt.com asked expert L. Craig Lemle, corporate managing director at Julien J. Studley, to share his insights. Lemle reports that normal vacancy rates are 10% to12%, but currently the vacancy rate is at about 3% citywide. “If it goes up a lot from 3%, that’s not necessarily a bad thing,” he notes.

As far as dot-com failures, and the possible impact on service providers and other types of businesses that have been born out of the technology boom, he says their failures will have “really no impact” on class A office space. As for the impact on class B space he notes, “The market was too overheated. People were desperate; they weren’t caring about terms; they were just taking space to get in there.”

The dot-com failures and return of space to the market “is not a bad thing for anybody, except of course the business that went under. For the next guy coming into the space, it’s already wired, built and ready to go. It used to be it could take six months to get into a space, but now people can move right in.”

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