We are generally skeptical of claims that real estate values are plummeting, as such reports usually just mean that a few rents have gone from absurdly to grotesquely inflated. Still, make of this what you will: Crain’s New York Business tells the story of realtor Dermot Co., which was having trouble moving its 3,300 square foot block of retail space on fashionable Allen Street. No doubt the developer imagined some handsome megastore or nightclub occupying the choice space. After a period of inactivity, Dermot Co. split the space in half and rented the resulting units to a Chinatown bus company and a restaurant supply store. These worthies are paying $60 per square foot — no confirmation that it’s a discount, but Crain’s points out that “space costs in the neighborhood were nearly $100 a square foot several months ago.”
Graham Rayman saw this happening in the high-end commercial real estate market last week. Some of you are thinking, hmm, time to open that bookstore! But the realtors are thinking: where’s our government bailout?