Quote:
Originally Posted by Crawford
What are you talking about? The NYC market is easily the tightest in the country. Midtown vacancy is practically 0%.
Even if the market did worsen, no building site will be "lost". Developers will just delay projects. The sites will all eventually be built, whether sooner or later.
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1st off: Yes, the NYC market is the best of the country and probably the world. However, just as soon as markets rise they fall. During the early to mid 1990's there was a huge plunge in the real estate market causing many real estate and development firms to go bankrupt (including nearly Donald Trump who was on of the few to luckily escape but at a costly price). An entire generation of architecture was lost due to that crash. In addition to all the companies flushed down the toilet, there were many projects that just could not stay afloat, nor could be put on hold due to financial reasons.
The same thing happened post 9/11 for a couple of years only not as severe. Now granted is was due to the attacks, the market still stood in the mud and did not rebound for a lenghtly period which sunk projects such as the Stock Exchange Tower.
The bottom line is that it is not as simple as putting a project on hold. Development firms stay alive by making money through projects. If no income is coming in there is no way to support further projects. In retrospect there is simply no time to put a tower on hold (unless for a short amount of time to work through zoning or legal issues). It's easier said than done.
How do I know all this? For the last two years and two plus more to come I have been studying real estate and business (inspiring to own my own real estate development corporation). The industry is very cut throat and fragile at the same time (especially with commercial projects). It is imporatant to get tenants as soon as possible. By not doing so projects can sink like a lead balloon. There are endless deadlines with banks (ehhh....it just gets so complicated).
To put it in plain english: the sooner the better.