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2002: Business Not as Usual

An industry copes with the aftermath.

By John Salustri | Updated on July 25, 2005

The opening days of 2002 saw some oddly optimistic reports from various sources about the short-term market to come, but most pundits shook their heads , even as the recession jumped the pond to become a global slowdown. As one market report summed up the year, 2002 would be a time of adjustment to the events of 2001.Insurance carriers certainly adjusted, with their determination to cut coverage for terrorism losses, and GlobeSt.com’s January 14 story unveiled plans by Congress to cover the gap.

And, as if the recession-related losses weren’t enough to weigh the industry down, Enron began to unravel, and initial cutbacks there dumped some 790,000 sf of office space back onto the Houston market. Of course, that vacancy would be a drop in the bucket compared to the long-range impact the likes of Enron would have. (Can anyone say Sarbanes-Oxley?)

Arthur Anderson took a hit as well that year, and threatened the Manhattan market with a 650,000-sf return to inventory. Insignia/ESG, in the waning days of its existence, filed corporate governance changes in the wake of shareholder questions about financial compensations.

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