A hopeful sign for the battered Boston office market
The unexpected decline in jobless claims should prove to be one great big holiday gift for Hub developers and office tower owners.
It raises the prospect that unemployment may actually come down faster – while helping bring back demand for office space and eventually new towers and buildings as well.
Massachusetts is already a leader here, with the state’s jobless rate of 8.8 percent significantly below the average.
It’s a trend, that, if it continues, could at least see the battered office market finally hit bottom sooner rather than later in the coming year.
Just a few months ago, Moody’sEconomy.com was projecting the loss of another 30,000 financial sector jobs in the Boston market – enough to put million of additional square feet on the market.
Even so, there’s typically a lag time of several months or more between a fall in unemployment and pick up in the office market, Bill McCall, dean of the Boston office market, explained to me in an interview last summer.
“Once hiring starts again, they are not picking up the phone and saying ‘hey Bill, find me some new space, it’s time to grow.’” McCall said of the impact of the downtown office glut.
That said, the outlook for 2010 sure beats what we were facing at the start of 2009.