NEW YORK — Enormous office developments from East Midtown to Downtown Brooklyn will likely not create the glut of office space some city officials feared, but instead will meet growing demand over the next three decades, the city's Independent Budget Office said in a new report released Thursday.
"We forecast a need for about 52 million square feet of office space through 2040," the report said. "This projected need is sufficient to support the full buildout of Hudson Yards, the World Trade Center, and other sites throughout the city, including East Midtown."
The budget office noted, however, that "there is substantial uncertainty inherent in making such projections, especially over three decades."
The report was issued following a request from Councilman Dan Garodnick, who has voiced concern that a Bloomberg administration proposal to rezone 73 blocks of East Midtown around Grand Central Terminal to allow for larger skyscrapers would flood the city with vacant office space, in the wake of major developments at the Hudson Yards, the World Trade Center, Atlantic Yards and Downtown Brooklyn.
After Time Warner announced plans in July to move its headquarters from Columbus Circle to Hudson Yards, Garodnick wondered whether the East Midtown plan, if approved, should be delayed.
"It is a big marquee tenant," Garodnick said of Time Warner in an interview with DNAinfo New York, "and in the New York commercial real estate market, there's only so many of those."
Garodnick did not immediately reply to requests for comment after the report's release Thursday.
East Midtown and Hudson Yards, as well as office development in the Financial District, Downtown Brooklyn and Atlantic Yards, are expected to create 47.5 million square feet of new office space across the city, Thursday's report said.
The IBO created a range of projected office demand based on three scenarios of how the city's workforce could grow in the future.
Depending on whether the city's growth falls under the IBO's "pessimistic," "midrange" or "optimistic" categories, future businesses could need between 30 million to 87 million square feet of office space, they found. The most likely midrange would be 52 million square feet of new space, the IBO found, even above the city's planned new construction citywide, the IBO found.
"The wide range of potential outcomes surrounding our midrange forecast...highlights the considerable uncertainty involved in office market forecasting over a 28-year time frame," the report said.