Even despite a dearth of financing for new construction, some developers remain optimistic.
Letb s not underestimate the lack of financing. As Anthony Westreich, chief executive of landlord Monday Properties, told The Wall Street Journal,
“It’s a bit of a cart-and-horse situation. You have tenants saying, ‘I don’t want to commit to a lease in your building until I know the financing is there,’ and lenders saying, ‘I don’t want to commit to financing your building until I know the tenants are there.’ “
Nevertheless, the halting of new construction could mean demand for newer buildings may be greater than the supply in the next few years. In addition, a few construction projects are moving forward, just not nearly as many as during the boom, as developers seek financing beyond the banks. Extell Development Co., for example, still hasnb t gotten a bank construction loan, but is moving forward on a building in Manhattan with a little help from partners in the Middle East.
Photo credit: Monday Properties via The Wall Street Journal