T: Is for towers in the sky

Has anyone besides me noticed the building growth in Manhattan? It seems odd considering the recession and the fact that Manhattan rents slid 14.6% in the first quarter. Central business districts are seeing rapid growth, but who is going to afford to be able to live in these high rise towers? Unoccupied space is piling up. New York, is the epicenter of the world's biggest office market, with roughly 350 million square feet of floor space. In 2009 already New York added 2.9 million square feet of vacant property. The average rate is now $57.35 per square foot. At one time it was over $100. Right now 8.5%, of New York's office are vacant. Still well under the U.S. average of 14.7%. But with virtually no demand for new space, that percentage is likely to hit double digits within months, putting New York's recovery well behind. Steven J. Pozycki, founder of SJP Properties in Parsippany, N.J., is building a 40-story tower in Midtown Manhattan with 1.1 million square feet of space. The $1 billion project, a joint venture with Prudential Real Estate Investors, was started in early 2007. It is scheduled to open next spring but has yet to find a single tenant. Larry Silverstein said he may delay construction at the World Trade Center site for decades. But Pozycki site 11 Times Square is past the point of no return. With all this space why not create a new way to buy. Lease to buy. There was a time that you would pay a higher rent and that money would go towards a down payment. What about the return of that? At least then all those empty towers would not be so empty and that is a fulfilling F.A.C.T.