Scott Rechler, president and CEO of Reckson Associates Realty Corp, stated that he's "Definitely seeing job growth," although he admitted that it hasn't been explosive growth by any standard.
The corporate emphasis on doing more with the same or fewer employees has run its course, he implied: "In the past six to nine months, all employees have been bleary-eyed. Employers are pushing people as hard as they can push them."
But economic development is more than just an expansion of employment demands, and the panelists agreed that true prosperity won't take flight until the region can give those workers a place to live.
"Workforce housing has not been properly addressed," said John Gutleber, president and CEO of Castagna Realty Co. "We have to try to bring the brightest people back to Long Island."
That's a tough chore in a region saddled with sky-high real estate and sales taxes. "Prosperity starts from the bottom up," observed Milton Cooper, chairman and CEO of Kimco Realty Corp. "Sales taxes affect that lowest level. We need to make the bottom vibrant."
Rechler called for a restructuring of the tax system on Long Island to align it more closely with "regional standards. But that's an initiative that has to start at the state level, because of the costs they have been pushing onto local municipalities."
In terms of movement in the office market on Long Island, the slowly expanding economy is starting to make its presence known, not only in job growth but in the stabilization of lease terms. "I'm starting to see shifts in our ability to push rents," said Rechler. "Concessions are stabilizing."
Windows of opportunity are starting to close for space users, he noted, and it's bringing about a "change of psychology among tenants. They recognize that they are at the point in the cycle where they need to lock in. The alternatives for larger blocks of space are getting smaller."
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John Salustri
John Salustri has covered the commercial real estate industry for nearly 25 years. He was the founding editor of GlobeSt.com, and is a four-time recipient of the Excellence in Journalism award from the National Association of Real Estate Editors.
