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Turning a Corner Toward Recovery

NEW YORK CITY-Declines in fundamentals are slowing and a few indicators are actually turning positive, both locally and nationally, say reports from C&W and CBRE.

By Paul Bubny | Updated on January 13, 2010

NEW YORK CITY-”The recession is over, and things aren’t great yet,” said Joseph Harbert, COO at Cushman & Wakefield, summing up the US and local economic picture and commercial real estate fundamentals at a media briefing Tuesday. Yet reports from both C&W and CB Richard Ellis, the latter–released Wednesday–said that in New York as well as nationwide, the market is turning a corner toward a gradual recovery.

“It won’t be a V-shaped recovery; it’ll be more like an inverted salad bowl,” Harbert quipped. Similarly, Matt Van Buren, executive managing director for CBRE’s New York tri-state region, said at his company’s Wednesday morning forecast breakfast, “We don’t think there will be an extreme turnaround in 2010, but it will look more like the better, second half of 2009 than the first half.” He noted that as “a canary in the employment coalmine,” temporary jobs grew in the second half of the year after declining in the first six months.

Wednesday’s report from CBRE Econometric Advisors says the office vacancy rate nationally increased by 20 basis points to 16.3% at the end of ’09. It marked the ninth consecutive quarterly rise, but CBRE-EA says the trend of severe increases “appears to be abating,” adding that some markets have approached their cyclical peaks. In Manhattan, Q4 vacancy ticked downward to 11.1% in December, marking the second consecutive monthly decline, according to C&W.

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