No Bull: Empty offices signal a second recession
Columnist Joe Queenan discusses how the activities in his suburban New York office building tell us everything we need to know about the economy.
November 29 2011 by Joe Queenan
A few months ago, I began telling everyone I knew that the economy was not improving one bit and that we were almost certainly heading toward a double-dip recession. I knew this because, for the last 18 years, I have worked out of a small office building in the suburbs of New York that has long been an infallible barometer of the health of the U.S. economy.
The building has five office suites, only two of which are occupied now. The other tenant is a small, self-funding village newspaper of a civic-minded bent. My office and theirs are the least expensive of the five units in the building. Our last neighbor, a massage parlor, was closed up by the cops after roughly five months in business. Massage parlors, of course, are recession-proof operations.
The only prospective new tenant I have seen visiting the building is a young man who would like to open a tattoo parlor, but he is meeting serious resistance from locals who believe that tattoos are inappropriate for a “historic” village like ours. A tattoo parlor, they reason, would violate the civic ethos of a village whose downtown businesses include a Subway, a Dunkin’ Donuts, a 7-Eleven and a bunch of saloons. However this little drama plays out, the fact that the landlord’s only serious prospective tenant would like to open a tattoo parlor gives a pretty clear sense that business is not booming in our village.
Offices in my building are not expensive; and, in the best of times, the landlord has to beat away new tenants with a stick. Over the years, tenants have included such mainstream operations as computer consultants, psychiatrists, import-export firms, short-term nursing providers, certified public accountants and graphic designers.
We have also had a concert promoter specializing in high-class has-beens, a travel bureau that set up European trips for American choirs that wished to sing in churches in France, Spain, Italy and Germany and— during one boom moment in the Clinton Administration—a company that sold shares in the procreative fluids of a spectacularly virile bull based in New Hampshire.
“It has been a source of amusement to me that highly paid economists discover where the economy is heading three to six months after it gets there.”
In good times, businesses with somewhat exotic products flourish in my building; in down times, nobody will rent the suites at any price. At one point before the crash of 2001, the computer consultants down the hall occupied not one, not two, but three office units filled to overflowing with servers and T1 lines. Those guys are long gone.
It has been a source of amusement to me that highly paid economists discover where the economy is heading three to six months after it gets there. When the best and the brightest economists in the world were forecasting U.S. growth in the 3.5 percent range earlier this year, I laughed. I laughed even harder when they started talking about a 30 percent chance of a second recession. Thirty percent? Make that 70 percent, guys. Don’t believe me? Come visit my office building.
Economists will scoff at the idea of measuring the health of the economy by evaluating the rental situation in a small office building in a suburban village 25 miles north of the Empire State Building. Well, I scoff at them. I have been keeping an eye on this oddly personal econometric measuring stick for almost 19 years, and it has never proven to be less than perfectly accurate.
When the economy is flourishing, my building houses concert promoters specializing in decrepit folk singers and octogenarian jazz musicians. When the economy is flourishing, we have tour promoters setting up choral performances in villages in the Auvergne so obscure that no American, and few Frenchmen, has ever heard of them. When the economy is flourishing, we have investment firms that can get you an insider’s price on shares in a prodigiously endowed bull.
When the economy is not flourishing, the offices in my building are filled with civic-minded, local newspapers, illegal massage parlors and free-lance satirists. When you’re a landlord and your longest-running tenant is a free-lance satirist, it’s nature’s way of telling you that it might be time to unload the building.