NEW YORK CITY-The metro area economy has outpaced both expectations and the nation in recovering from the downturn, a level of performance that tops the list of six megatrends for the city, Delta Associates' Alexander Paul said in a presentation at the inaugural New York City Trendlines event Tuesday, sponsored by Transwestern and Delta, its research affiliate. “Our regional economy has really been a comeback story,” said Paul, EVP with Delta. Since 2000, it's been second only to the energy-boom city of Houston in job growth.

Along with sheer numbers—Delta is projecting average growth of 90,600 new jobs per year between 2014 and 2018, faster than the pace that was set between 2004 and 2008—the mix of employment sectors has changed. “Our economy benefits when we have additional diversity and are not too dependent on any one sector,” Paul said.

On the subject of comeback stories, Lower Manhattan's post-9/11 resurgence comes in at number two on the list of megatrends. Since 2000, for example, its residential population has grown 150%, compared to an increase of 4% citywide during the same time frame. Meanwhile, the rebuilding of the World Trade Center, and the project's success in attracting major tenants from other markets, has further transformed Downtown, aqttraccting both office tenants and retail to the neighborhood.

Another transformation has taken place in the workplace: what Paul termed “densification.” An effort by office tenants to lower their occupancy costs by reducing the amount of square footage per worker, it's been most frequently used by large consultancies, but other professional firms are trying to adopt the model. However, Paul noted that this megatrend would plateau over the next few years, partly due to pushback from both employees and managers.

Lower Manhattan is not the only submarket to comprise a megatrend in and of itself. The emergence of Midtown South from a nondescript assortment of industrial and loft buildings into an office magnet has reshaped the leasing landscape. Currently it has the lowest vacancy rate of any Manhattan submarket, although that rate has ticked up a few points recently as rents have risen.

Even so, Paul noted that there isn't enough availability to accommodate all of the major tenants that wanted to relocate to Midtown South, and that has helped feed the fifth of the megatrends: the disruption of geographic norms. Large-scale tenants are now moving to neighborhoods that they wouldn't have considered even a few years ago, he said, citing the relocation of Jones Day and Condé Nast to Lower Manhattan and L'Oreal establishing Hudson Yards as its New York City offices.

Even as office tenants densify their spaces to cut costs, sixth of the megatrends reshaping the economy is the “flight to quality” concept as it applies to office leasing. In 2002, the vacancy rate for high floors in super-premium buildings was 11.4%, today it's 4.4%, well below that for other spaces.

Following Paul's market overview—which also discussed the national economy, capital markets and North Jersey industrial trends—Transwestern honored two individuals that have made unique and innovative contributions to the commercial real estate industry as a whole and to the New York region in particular. Clarion Partners' chairman and CEO, Stephen J. Furnary, and TIAA-CREF's managing director of global real estate, Philip J. McAndrews were named TrendSetters of the Year for 2013.