RXR chairman Scott Rechler: We're seeing big surge of companies seeking office space in NYC

Office Market Dynamics - Manhattan office buildings are becoming the "people data centers" of the AI era, attracting companies seeking talent and prime locations with amenities [2] - There's a "flight to quality," with 140 leases signed at over $100 per square foot in the first nine months of the year, matching the total for the previous year, indicating scarcity of high-quality space [4] - The scarcity of high-quality office space is causing demand to trickle down to other properties [4] Real Estate Conversion & Public Policy - Tax abatements, specifically the 467M program, are broadening the scope of buildings suitable for conversion, potentially unlocking more capital for these expensive projects [5] - A 90% tax abatement for 35 years is making conversions financially viable, exemplified by the conversion of 5 Times Square into 1,200 residential units [6] - An estimated 20,000 to 40,000 residential units (20 to 40 million square feet of space) could result from office building conversions [6] New York City Governance & Politics - New York's governance structure places significant oversight with the governor, particularly regarding real estate taxes, fiscal responsibility, and public safety funding [8] - The mayor has some influence over rent regulation, especially for rent-controlled apartments, but past attempts to freeze rents have been unsuccessful [9] - Public safety is the biggest risk to New York City, and the mayor's influence over the NYPD is critical for maintaining safety and his political success [11][12]