Murphy also pointed to a series of companies he had encountered which were "willing to spend capital and positive on employment numbers." And he is bullish on Midtown. The dynamic citywide showed a divide between Downtown and Midtown. Midtown was showing 8.3% vacancy down from 10.5% a year before. Downtown's vacancy on the other hand has gone up from 7.6% to 9.3%. Murphy feels that Downtown may need to rethink pricing based on Midtown.

Shanahan pointed out however, that the additions to supply in Downtown are much greater than midtown, as far as a one-to-one comparison goes. For example, the addition of the World Trade Center will bring 10 million square feet onto a 90-million-square-foot market, he explained. And Stacom thinks some of the properties might hold pat with the market returning, as well. If a property has 83% occupancy and is more than meeting its debt, owns the building, etc., it may hold that space off the market and wait for rates to return, rather than dropping the rates and filling the vacancy for a discount, she explains. Stacom also predicts that the "smoking hot" residential market downtown is going to drive companies to lease downtown.

There is an indication that Midtown's pricing may eventually help Downtown, as pricing adjusts. As velocity trends upward in Midtown, those companies that missed the bottom or hit the bottom, but only did three to four year lease terms, will attempt to lease or renew while Midtown pricing are on the rise. As Murphy noted, "the story is not yet written for Downtown."

And the two large influences on the market that are coming down the pike, will be offshore investment in B assets and the eventual decision on the FASB accounting rules. Foreign investment will be chasing yield over the next year, which should inevitably push them to B assets. Stacom noted that as foreign investors begin to understand how to underwrite some of the midlevel New York tenants, they will become more comfortable with B asset investments.

Shanahan explained that the FASB rules will have ancillary effects on the market, possibly leading to more large tenants looking to purchase properties instead of holding long-term leases on their balance sheets. Stacom notes this could increase competition with CRE companies, as big companies can borrow money easier than many private commercial real estate investment companies, however there will be limited market for which properties a company is interested in purchasing.

Murphy thinks the major issue will come with smaller building tenants, as FASB will naturally create a slowing down of leasing and hiring strategies, killing leasing velocity and expansion. However, a key driver to the market could be quite the opposite: Google. Their recent purchase was not a reaction to FASB, according to CBRE, but a move to gain a foothold in the New York City market. This could generate recruitment and expansion over the coming years.