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CBRE: Expect Status Quo on Office Sales

NEW YORK CITY-CB Richard Ellis' William Shanahan says a wait-and-see approach is in order for improving investment sales conditions.

By Cody Lyon | Updated on March 22, 2009

NEW YORK CITY-Not surprisingly, 2008′s macroeconomic uncertainty and tightened credit markets slowed the sales of Manhattan’s office properties, lowered their values and led to a decline in rents for the year, according to a new special report on office investment from CB Richard Ellis. The report also says additional direct and sublease space caused the Manhattan availability rate to rise from 7.9% in 2007 to 11.3% by the end of 2008.

As a result, a wait-and-see attitude has overtaken much of the investment community and according to William Shanahan, CBRE’s vice chairman of investments, the pause will likely continue throughout the next year, or at least until the credit markets return and the gap narrows between buyer/seller price expectations. “Whether it’s through the entire year or ends by the third quarter, I think you’re going to see the status quo for the next six months,” Shanahan tells GlobeSt.com.

Still, in light of this past month’s job loss figures that some are saying were lower than expected, Shanahan says CBRE uses those numbers as a barometer of what companies will do with their space. “Obviously, we’re watching very closely, not just for the number of job losses, but also whether the losses have started to pick up, or decrease,” he says.

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