The problem for real estate, explained Thomas V. Giannone seniordirector at Cushman & Wakefield of NJ, East Rutherford, is thatthe overall office vacancy rate in Northern and Central New Jerseyis 20%. With growth in high-end office jobs lagging, it's going tobe tough to bring that number down.

On the one hand, "office leasing activity has picked up by 30%,which is great news, and there were several very large transactionslast year," Giannone told the group. "The problem is that some ofthe largest transactions were tenant movement and not tenantexpansion, so the activity doesn't translate into net absorption.Net absorption was actually down a little."

Even so, office properties remain a target in terms ofinvestment sales. "Activity has picked up substantially - a 25%increase this past year over the year before," Giannone said. "Ifyou're on the investment sales side, you've had a very good twoyears. If you're on the leasing side, it's been tough."