This comes after Web-consulting firms, Scient, Xpedior and iXLEnterprises all announced major job cuts and office closings.Scient is a co-tenant with Jones & Day at a Tishman-Speyerproperty in mid-Manhattan. Lower ad budgets at dotcom firms and alessening of demand for Internet business services are contributingto the downturn.

"I don't have a problem with service businesses in general,"says Tony Malkin, president of W & M Properties. "But you haveto look towards the credit of these businesses and how it equatesto the level of risk that you are prepared to take. There is acertain risk in service businesses; there is a greater risk inservice businesses in rapidly changing or evolving areas."

"The ripple has become a splash," he observes. "Capital marketsare not funding these businesses. But this is healthy because weneed the space and the workers. Companies are starved foremployees."