[IMGCAP(1)]NEW YORK CITY-As job cuts surge in the financial industry, sources say that although the layoffs could have some impact on the local office market here, it won’t be as bad as the last downturn. As GlobeSt.com previously reported, financial firms such as Merrill Lynch are cutting jobs, and with troubled firms such as Lehman Brothers , UBS, and with recent reports that Citigroup Inc. will cut the roughly 65,000-employee investment banking unit by 10%, vacancy concerns have begun to swirl.

Jan Svec, a director in Fitch Rating’s REIT group, tells GlobeSt.com that it is uncertain at this point how financial job loss will affect the office market here, but she says that the good news is that things are “going to be better than last time,” although as financial firms continue to make cuts, “things could change.”

[IMGCAP(3)]Hugh Finnegan, an attorney in the real estate group at Sullivan & Worcester LLP, agrees with Svec that the office market might not be as dramatically affected as one might expect. “There is a huge difference between this cycle on the last heavy down cycle of the late ’80s and early ’90s,” he says. “Although new towers are being built now, there are few buildings with available space.”

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