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US Office Market Ripe for Investment: Report

NEW YORK CITY-A series of reports from Grubb & Ellis/Knight Frank suggest now is the time to buy into the US office market. Occupancy costs have cooled to 1999 levels as the US struggles with a still-fragile economy, tech-wreck fallout and the continuing ripple effects of Sept. 11.

By Michael Gilliard | Updated on March 08, 2002

NEW YORK CITY-Grubb & Ellis and its London-based partner Knight Frank are encouraging global office investors to consider buying American as the US begins an economic recovery, evidenced by Federal Reserve Chairman Alan Greenspan’s upbeat comments yesterday. Hobbled by the tech wreck and reverberations from Sept. 11, space in US markets that once commanded top dollar has dropped closer to 1999 levels.

“Our research is telling us the same as many resources here in the US: the economy is already showing signs of getting back to normal,” says Grubb & Ellis CEO Barry Barovick. “Many companies are not forward planning for their real estate needs, and those companies are going to pay a steep price both here and abroad as space begins to tighten and investment property prices rise.”

Barovick predicts New York is predicted to enjoy a healthy comeback by 2003, despite occupancy costs falling 8.3% last year. “Its stature as an economic epicenter of world financial markets, and its proven resiliency as a stable world business community, is obvious to both Americans and the World,” says notes. “Many have speculated on the outflow that followed the World Trade Center attack. The truth is space is tight, and it’s going to get tighter.” The Manhattan market and surrounding office markets have still held onto much of the rental gains of the last two years, the group claims.

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