Ah wonna-ful, ah wonna-ful, but please, turn off the bubble machine.

(A Baby Boomer reference with apologies to Lawrence Welk / Go retro, Millennials, and you'll find out what I mean)

Last night, The New York Observer, New York's only Leftist, Rightest, Centrist newspaper held its Third Observer Living Exhibitors Showcase. Co-presented with LX-TV's Open House NYC, this biannual event offered Developers and other Real Estate Professionals a chance to show their wares to brokers and the public.

Part of the event included a series of panel discussions with well-known experts addressing everything real estate from apartment design to shadow inventory. The last group to speak was particularly interesting. The panelists were Pam Liebman, President and CEO of Corcoran (I knew her when she started as an office manager--what a success story!); Dorothy "Dottie" Herman, President and CEO of Prudential Douglas Elliman (don't know her personally); the lovely, well spoken Ivanka Trump (I'd like to know her); and the ubiquitous (and perhaps omniscient) Jonathan Miller. I know Jonathan and he's the mastermind behind the super real estate blog,
matrix.millersamuel.com. Jonathan explains in his blog that its name is not derived from the movie The Matrix but instead, connotes "a cross-section of market information"...but believe me he's one guy who understands the deeper meanings of matrix theory, linear regression, weighed means and correlation coefficients.

The four of them covered a lot of territory regarding the present state of affairs. I thought this was done with caution and a new reserve, but beneath it all I perceived a subtext of positive things already happening and a sense that more lies ahead. The audience, mostly brokers, seemed to sigh in unison at any expression of optimism. (The other audible sounds occurred when the moderator asked to see if there were any potential buyers in the house, and you could literally hear the rustle of my fellow brokers reaching into their pockets for business cards, and see a perceptible shift of the crowd toward the hand raisers). As for me, I'm willing to stick my neck out on this one and be overtly optimistic. Oh, BTW, Steve Kliegerman, Executive Director of Development for Halstead Property, and a panelist from earlier in the evening has expressed similar optimism; and I can tell you from past conversations he has accurately anticipated every market shift over the last ten years including the downturn at a time when very few knew it was going to happen.

But back to the neck sticking out part (what?!). I'll put it this way, my bio mentions I like tournament poker. Tournament poker's a different animal. Put me in a cash game and I get slaughtered; but in tournament play I have 6 wins and 15 final table appearances. When in a macro environment it's all about utility, and this translates well to our situation. When it comes to defining a bubble, economic, real estate or otherwise, an integrated analysis of utility of usage, purchasing power and speculation is the name of the game. So the question arises: have we as Manhattan real estate owners experience a bubble burst (and the irreparable damage this metaphor implies) or is this just a very, and I do mean very, hefty correction? I think the latter is most likely (am I the only one?), not because I'm some manipulative, self-serving real estate broker in deep denial, but because I "really, really" think this will prove to be the case (do you hear me, Sally?). On a national level the fundamentals fit best with the former (pop!). They've taken a different course, and THAT recovery will follow a different path. But I still contend Manhattan will prove to have hemorrhaged less and will heal faster than the rest of the nation, and the world. This isn't to say we're not dependent (no truer double negative's been spoken), but we are also unique in many ways, and capable of many things. To view the extent of Manhattan's real estate ills we must consider our still strong utility of usage, the wane (quite temporary, I say) in purchasing power, and the relative lack of speculation to arrive at a proper diagnosis--and it ain't a piece of bubble skin lying on the floor. The lesser variables constitute an intra-active coalescence of job volume, level of salaries, and the public's state of mind, but the present and anticipated range of each of these elements is simply not that extraordinary, and seems to confirm the big correction scenerio vs. major calamity. Buying power, the ability to support high pricing, ever increasing international appeal despite a global downturn, a returning New Yawk optimism, and yes, plenty of utility all indicate we are in for a pleasant surprise.

--Leigh Zaph. (any comments can be emailed to us at webitorials@manhattanhomesinc.com, thanks).