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Last week’s GlobeSt.com Quick Poll asked readers what effects financial services layoffs will have on the office market, with 48% of readers responding that layoffs would destroy it, 28% saying they wouldn’t have much impact and 23% indicating that they will create opportunities for other tenants looking to expand. Michael F. Beale, senior vice president with Highwoods Properties Inc. in Orlando, spoke with GlobeSt.com about the possible bright side of layoffs:

“Depending on the breadth and depth of the layoffs, it could seriously affect the office market. I think that we have some serious challenges facing us in the banking system that could lead to direct layoffs as they try to save money, but on the other side there’s a whole industry of services that will grow. There are other industries that will keep the market somewhat stable.

“There are currently other parts of the economy that are growing, which are providing absorption in some respects. We see growth in businesses dealing with manufacturing and the supply chain because it appears that we’re exporting more now. We’re also seeing a lot of growth in legal services and companies that provide services to financial institutions, such as workout firms.

“The bad news is that we are having trouble in our banking system and financial investment industry. The good news is we are seeing an uptick in these other mainline industries. We have tenants that are involved with logistics for manufacturing companies or legal services to the banks; they are now on a growth spurt. While one side of the economy is failing, other parts are still stable or growing, and as they grow they need places to occupy.

“I’m not seeing this as doom and gloom. I see it as a shifting of emphasis from one industry to the other. I think there will be some disruption as we go through this, but so far the market has been pretty resilient. I’ve been buoyed by the fact that we still see absorption coming from these other industries.”

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