Sunday, October 03, 2010

Office tower (jobs and tax revenue) coming in five years? Eight years?

On Wednesday, Forest City Ratner Executive VP MaryAnne Gilmartin was not ready to predict when the planned office tower--a major component of projected office jobs and tax revenues--would be build.

"With commercial vacancy rates in New York City exceeding 10%, and the replacement cost of what it takes to build an office building and the rents that one could charge, economic equation does not pencil out," she said.

"That means that we will wait for the recovery of the commercial office market, which in New York City tends to be cyclical--it could be five years, it could be eight years," she said. "It's very difficult to know when that moment is."

In Manhattan

"It depends on what's happening in downtown and midtown Manhattan," she said, adding "It's very difficult to imagine anytime soon that the office rents that one could charge in Brooklyn would justify new construction."

Five years? Eight years?

Over the next decade, according to the New York Observer (click on graphic to enlarge), well over 30 million square feet of office space is planned.

Perhaps, if the economic cycle makes it feasible for these buildings to get built, so too might B1--with anywhere between 336,000 square feet and nearly 600,000 square feet--"pencil out."

Perhaps Brooklyn elected officials, spurred by Forest City Ratner, will make sure that "Brooklyn" gets its share of office space, and thus offers subsidies or an anchor tenant to make it work.

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