New York City has elevated to singular rank above and beyond other U.S. real estate markets, acheiving status with London, Tokyo and Hong Kong on a global scale. It's the ultimate 24-hour city and world financial capital, drawing brainpower elites and monied moguls from far and wide. The trickle down effect of Wall Street wealth creation has fueled unprecedented increases in commercial rents and coop/condo prices. The market has boasted the healthiest occupancy rates across all property categories in the country, and helped create an aura, boosting investor appetites for real estate in other markets.

But New York appears to have topped out. Mayor Bloomberg, no stranger to Wall Street and the vagaries of financial markets, has called for municipal budget cuts, girding for trouble ahead. The credit crunch begins to take its toll on the city mainstay financial companies, who take writedowns and fear their transaction volumes will be compromised next year by tighter credit standards and possible recession. Wall Street barons can be ruthless when it comes to protecting their own bonus payouts - the hatchets are out. Layoffs start to add up quietly - a few hundred here and a few hundred there. It started in mortgage related businesses, but seems to be spreading in a move to more general belt-tightening. Advertising, media, accounting and other support businesses may need to follow suit. Condo markets may soon start to feel the pinch unless offshore buyers (buoyed by the weak dollar) can pick up the slack. The $150 plus per square foot office rent peaks look increasingly unsustainable.

New York won't collapse - its 24-hour characteristics and global gateway status provide ample cushion. But brokers, boutique owners, and restaurateurs should start to get nervous - trickle down may trickle off for a while. And New York's shudders will dampen real estate prospects nationwide. Market aura works two ways.

Am I too gloom and doom or will Wall Street troubles start to impact real estate soon? Comment. See below.