REAL ESTATE
AND
(Copyright, 191T, by The Record and Guide Co.)
NEW YORK, OCTOBER 27, 1917
SHORTAGE OF RENTABLE SPACE IN ALL BOROUGHS
FOUND THROUGH SURVEY JUST FINISHED
Committee On Demand For Buildings Makes Report
T NVESTIGATIONS pursued by the
^ Committee on the Demand for Build¬
ings, Henry Atterbury Smith, chairman,
has revealed the fact that there is an
urgent demand for buildings of nearly
every type, though in some instances
rentals sufficient to make construction
work profitable cannot be obtained.
The situation is an unusual one, and
real estate today is in a healthier con¬
dition than for many years past.
Real estate owners are receiving good
returns on their investments,_ though
cost of maintenance and operation have
increased. Probably never before in
the history of the city have fewer
vacancies existed than at the present
time, and the ultimate result should be
that investors will come back and place
their moneys in this form of security.
The demands of the Government, so
that the war can be properly prosecuted,
come first, and the response to the
Second Liberty Bond issue clearly
demonstrates that the people with
money are standing back of the
country. No immediate increase of
purchasing power, so far as real
estate is concerned is looked for
until such time as the war conditions
are fully understood, but when the turn
does come people prominently identified
with the market look for a movement,
both in new construction and in invest¬
ment buying, such as has not been seen
in years. The new construction work
will in all probability precede invest¬
ment buying, but owners today are now
more firmly entrenched than for a long
time.
Loaning institutions are taking the
stand that while new commitments can¬
not be expected for the time being, still
every eflFort will be made to allow exist¬
ing mortgages to remain and not hamper
the mortgagor. This is certainly a word
of encouragement, for. except in iso¬
lated cases, these institutions do not
expect to make owners reduce their
loans. In other words, these interests
wish to cooperate with owners and
stabilize real estate values.
The Committee on the Demand for
Buildings, which is a sub-committee of
the Committee on the Alleviation of
Building Stagnation, Elliott Smith, chair¬
man, has compiled a large amount of
data from various sources, some of
which are printed in this issue.
The demand for office space is in¬
sistent, not only in that section south
of Chambers street, but also in the
Grand Central Terminal zone. From
the various opinions quoted below it
will be seen that war conditions have
been an influencing factor in filling up
available office space, and while it is
expected that there will be a certain
amount of office space thrown back on
the market after the war ceases, never¬
theless the natural growth of the city
will tend toward taking up of not only
this space, but create a demand for
more.
Several large office buildings have
been ^ erected in the Grand Central
Terminal zone during the past two or
three years.^ They have been promptly
filled at prices equal to. and in some
cases larger than, obtained downtown.
It is generally conceded that the rate
at which new office buildings have
INTEREST in the movement to end
^ the stagnation in the huilding
industry in the Metropolitan Zone
is increasing daily. Printed herewith
is a condensed report of the Com¬
mittee on the Demand for Buildings,
which includes many expressions of
opinion from men well versed in
the situation. The concensus of
opinion is that there is a shortage
in nearly every class of building, and
unless something is done to relieve
the condition, the shortage will be¬
come acute. There is a general
feeling that rentals will increase
materially, unless a huilding move¬
ment is inaugurated.
been erected during the past few years
can be continued for some time, and
tenants readily found.
Following is a digest of expressions
of opinions given by a number of lead¬
ing concerns who keep in close touch
with the office building situation, espe¬
cially in the section south of Chambers
street and in the Grand Central Termi¬
nal zone :
J. C. Cushman, of Heckscher & De
Snulles: "All the available uptown
office buildings are practically full.
Buildings recently completed have been
completely tenanted as soon as occu¬
pancy could be leiven. This is notably
true of 50 East 42d street, now 95 per
cent, rented, and the Vanderbilt-Con-
course Euildiner. 100 per cent, rented.
Too many buildings are a detriment, but
this district is not over-housed, and
tenants can be found for office buildings
after they are built at the same pace
as during the past few years. The
downtown district is also in demand.
We recently had an order for 1,800
snuare feet in an office building between
Wall street and the Battery, and the
following were the only vacant spaces
found for rent: at 11 Broadwav, 1,767
square feet, $3,000; American Express
Buildine:, one entire floor; at 66 Broad¬
wav, 300 square feet; at 42 Broadway,
600'square feet, $1,000, and at 31 Libertv
street, 1,537 square feet. $28,000."
August Heckscher: "A great deal of
space is obtainable at reasonable rates
and at rates actually lower than present
conditions, in the way of costs and
delays, would warrant. Rents have not
advanced even approximated within
the range of increased cost. Money on
bond and mortgage will be increasingly
difficult to obtain."
James S. Coddington, of Wm. A.
White & Sons: "There is a fundamental
demand for office space in the down¬
town section. All of the high-class office
buildings under our management are
fully tenanted, and in the uptown sec¬
tion buildings are being rented with
rapidity."
Edward C. Cammann, of Cammann,
Voorhees & Floyd: "Ofifice buildings
today are extremely well filled, due in
no small part to the war. and while it
may be expected that there will be a
falling off when the war is over, so few
buildings have been erected in recent
years that the demand for space, due
to the natural growth of the city, should
in a short time fill up the^ vacancies
created when war conditions have
ceased their demands."
Laurence McGuire, President of the
U. S. Realty and Improvement Com¬
pany: "The demand for space far
exceeds the supply. After new build¬
ings are erected tenants can readily
be found."
Geo. T. Mortimer, President Equit¬
able Office Building Corporation: "Prac¬
tically all office space is occupied, due
largely to war conditions. I feel that
some of this space will be back on the
market when the war is over, though
to what extent no one can foretell. A
large amount of space has been taken
by the representatives of foreign gov¬
ernments for purchasing departments,
as well as for various propaganda in
connection with war matters."
Frank Lord, of Cross & Brown
Company: "The demand for new build¬
ings and for space is better than it has
been for five years. South of Chambers
street the market is in an excellent con¬
dition, a vast number of vacancies hav¬
ing been filled. In the uptown district
there is a shortage of office space, and
a number of new buildings, were they
to be erected, could be filled with desir¬
able tenants."
Lawrence B. Elliman, of Pease & Elli¬
man: "There is a very large demand
for space in both downtown and up¬
town office buildings, especially in the
wholesale district south of 33d street.
There is but little to oflfer to applicants.
This same condition applies to the
financial district."
Albert B. Ashforth: "In the down¬
town district, there is an unprecedented
demand should continue to be active,
story buildings arsi 100 per cent, rented,
and we are increasing rentals as the
leases expire. It would appear that the
demand should continue to be active,
and that any new buildings erected
south of Chambers street could be
quickly tenanted. The Uptown district
has not felt the demand as much as
the Wall street section. This is due, in
all probability, to the fact that around
the Grand Central Terminal, several
high buildings have been erected. How¬
ever, a dearth of space in this section
is imminent."
Charles F. Noyes, of Charles F.
Noyes Company: "All desirable down¬
town office buildings are 100 per cent
rented. There is a healthy demand for
space of this character. Rents are con¬
siderably above the average, but it
looks to me as though these conditions
would continue for several years to
come."
Russell Marston, of Marston & Com¬
pany: "The majority of ofifice buildings
below Chambers street are fully rented
and there is a big demand for space.
Many of the office buildings uptown
are fully rented, but there still remains
a sufficient number of vacancies to
supply the demand at present."
M. Morgenthau, Jr., of M. Morgen¬
thau, Jr., Company: "Downtown ofifice
space is in fair demand, at rentals about
50 per cent in excess of what they were
two years ago, and the same conditions
apply to the L^ptown district."
Samuel A. Herzog: "In my opinion,
the present supply of new buildings in
the Grand Central Terminal zone will
afford such additional space to the
present accommodation, that there will
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