20% of Downtown NYC Office Space Destroyed

Approximately 20% of the downtown Manhattan office market was destroyed in Tuesday's terrorist attacks, but the majority of displaced tenants should be able to relocate in Manhattan, according to separate analyses by two commercial real estate services firms. Grubb & Ellis Co., Northbrook, Ill., said its initial statistics show that about 15.5 million square feet of office space was destroyed (about 9.52 million square feet of it in the twin towers of the World Trade Center) and another 12 million square feet was damaged. The company said currently available space in Manhattan totals about 25.5 million square feet, although "only a small percentage of this available space may be in the large floor plate format like that found in the World Trade Center and surrounding buildings." CoStar Group Inc., Bethesda, Md., has estimated that over 80% of displaced tenants will have "viable relocation options" in Manhattan unless "significant additional structures" are deemed uninhabitable. "If all of the tenants currently displaced from the World Trade Center were to relocate within Manhattan, we believe the overall vacancy rate could drop to an unprecedented 4.3% [from a current 7.4%]," said Jay Spivey, CoStar's director of analytics. CoStar estimated that the office inventory in Manhattan has been reduced 3.6% to 476 million square feet. CoStar's website address is http://www.costargroup.com.