On the topic of outsourcing, Kellner noted that, while it has been a way of life for decades, the fact that now white-collar jobs are being outsourced has created a "depth of resentment." The economic chair at Long Island's Hofstra University also addressed increased capital spending, noting that companies are spending on equipment, not on space. Real estate space that he sees as in demand include hospitals, doctor's offices, assisted living, gated communities, educational facilities, technology centers, bank branches and back offices. Another hot category is industrial-to-residential conversions.

"We're seeing pockets of positive signs," LePatner founder Barry LePatner said he sees a tremendous opportunity in the 532 miles of coastline product in the New York City environs. His projects to watch include the $400-million Silvercup Studios development and the Jersey City rejuvenation.

Richard Anderson, president of the New York Building Congress, noted that the construction outlook is good for infrastructure projects, particularly those dealing with transportation matters. He expects the office construction numbers to fall in 2004 and 2005, but to rebound in 2006. On the residential front, 2003 was a banner year with "strong demand," he noted, saying that 20,800 units, representing a 12.4% rise, came online--a level not seen since the 1960s. "Construction is a job engine for the city," he said, predicting that the construction arena will hold 124,500 reported jobs in 2006.