Retail promising to bloom despite rebuilding debacle.

Downtown has passed its post-911 doldrums and is reverberating with signs of a high-end retail renaissance, said chairman and CEO of L&L Holding Company, David W. Levinson at REBNY's mid-year member's luncheon at Cipriani 42nd Street last week.

"I look at downtown and I see a lot of revitalization; with more retail it's hotter than ever. It shows a big retail buzz," Levinson said.

Levinson was joined at the forum by Robert Futterman, chairman and CEO, Robert K. Futterman Associates; Neil J. Goldmacher, executive vice president, Newmark Knight Frank; and president of Macklowe properties, William Macklowe. The event was moderated by the New York Post's Lois Weiss.

Levinson told REW he was "extremely optimistic" about the future of downtown as a thriving, 24/7 neighborhood. "Wherever you go you see construction. It's really the seeds and the buds which are popping up out of the ground. This phenomenal transformation is very exciting to see," he said.

He added that he is already fielding numerous enquiries from high-end retailers for space at 195 Broadway, the 1 million s/f, 29-story property, which L&L bought with GE Asset Management in January 2005 for $270 million from MTA chairman, Peter Kalikow.

Considered to be one of the finest prewar buildings in one of the most desirable downtown locations, 195 was constructed in two phases from 1912 to 1922/The neo-Classical office building and former headquarters for AT&T was designed by eminent architect, William Welles Bosworth, who called it his "temple on Broadway," and is currently under review for landmarking by the Landmarks Preservation Commission.

While the building's office space is already occupied by a number of high-profile clients, including Thomson Information Services, Holland & Knight and Morgan Stanley, Levinson said several high-end retailers have eyed the retail portion, although the landmarking process is delaying any firm deals for the space.

The REBNY panel also examined the issue of alternatives to the pricey Manhattan markets, with panelists noting a lack of office space in both the Queens and Brooklyn markets. Goldmacher told REW that the office space crunch in both Brooklyn and Queens West, plus the costs associated with building there meant that, although there are some incentives from the city for corporate tenants, these boroughs are less of an attraction than across the river in New Jersey.

"The problem for the boroughs is that space in alternatives like Jersey City are more plentiful," said Goldmacher.

"There is more of a nucleus of existing companies in those areas, more infrastructure and amenities. The buildings are already there and up and the costs are lower, so the incentives are greater, in addition to the asking rents being lower."

However, Goldmacher said developments such as the Citibank headquarters in Long Island City were a promising sign of future investment in the boroughs.