Where is the office leasing market going?

That's a good question. Some people are advising big tenants to lock in now while the going is good and the economy supposedly soft. Others are saying, especially here in Chicago, that a big glut will hit the market in 2009 and beyond that will rival that in the 1990s.

Both may actually be right. A downturn is a good time to lock in megaleases for office space because landlords want the certainty of a major tenant while the tenant might get a better deal. But if you were a smaller tenant or not dying to get space now, when absorption decreases and/or more lease and sublease space comes on to the market, then 2009 is probably a good time for you! It's all about the endless supply and demand.

I personally don't see us going back to the 1990s because I don't think we're all that overbuilt. There may be exceptions to this in some markets. As I have said before the other factor that could come into play that might change my mind is a major bloodbath with big tenants dumping space, and we're not seeing that yet.