Likely Consequence: Moving Out of NYC

Some dispersal of financial entities to other U.S. cities seems inevitable.
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"Want to work on a major relocation project?" Two calls, one Tuesday night, one Wednesday morning. Same words.

Both were from longtime clients, now charged with beginning planning not just where to house staff and systems for the next couple of years, but to also plan, in tandem, where their companies will move -- permanently. And it will not be to somewhere else in Manhattan.

Two calls to a consultant do not a trend make. But something big, and important, is happening. And we need to talk plainly about it -- straight talk among friends.

As painful as are the stories now trickling out of lower Manhattan, as the rescue groups search for survivors -- and as hopeful as are the anomalies, the stories of people who "rode the building down" and survived -- we also know grim realities across the economic landscape are about to emerge.

And while they worry, grieving, about their missing colleagues, workers at many companies hit hard by Tuesday's disaster are also scrambling now, trying to get their firms back into business -- somewhere, anywhere

Northern New Jersey looks like the primary, obvious escape valve for financial entities, as it has been for more than a decade. Given the amount of space lost in Manhattan by the collapse of the World Trade Center towers and the subsequent collapse of other nearby buildings, there will not be nearly enough space in the city to accommodate all the relocations over the next weeks and months.

So Jersey will feel the immediate impact, and every inch of remaining Class A space will be quickly tied up. If it has not been already.

But for the longer term, what I am hearing is a new commitment to disperse facilities, staff and systems far more widely. Not to just jump across the harbor, but to jump across, and around, the country.

Part of this is not new, of course. Big companies have long worked on preparing for the unfathomable disaster, with backup systems centers, distributed regional offices and the rest of it.

(And, for the record, after this column was written in Austin, it was edited in San Antonio and published by an editor in Highlands, N.J. Since our offices were evacuated Tuesday, our offsite capabilities have kept us publishing.)

What I sense now --

and what I think makes sense

-- is a far more profound geographical redistribution of much of the financial industry. The heart remains on Wall Street, but much of the brains and ganglia move out.

It seems to me very unlikely that the World Trade Center will eventually be rebuilt, at least, not in anything like its previous, immense form. New towers would simply become another inviting target. Clustering hundreds of thousands of people once again in Lower Manhattan, where dealing with fires and other disasters is agonizingly difficult in the best of times, seems unlikely.

I assume we will see a dignified and substantial memorial to all those who died in Tuesday's madness constructed on the World Trade Center site -- perhaps something like the profound and powerfully affecting Oklahoma City bombing memorial, designed by the brilliant young architects Hans and Torrey Butzer -- as well as some commercial redevelopment. The site is simply too large to ignore; something will rise there.

But as we enter the period of coping with the economic fallout from Tuesday's attack on Wall Street and our government -- there is no other way to describe this -- we need to look not only at the shortest-term issues, such as keeping a market slide and a likely national recession from sliding into something much worse, but at the longer-term consequences.

One of those, it seems certain, will be this removal of a very significant chunk of the financial industry from New York City, and its dispersal to other, nascent financial centers. Atlanta, certainly. Denver, probably. Cleveland, perhaps. But also, I suspect, down to even smaller urban areas. Good air connections are a must, but hugeness and urban clamor are not.

No part of these words, please know, arises from any anti-New York sentiment. It is a city I know well and love,

have

loved for more than 35 years, and where I used to live, in a wonderful apartment on a glorious side street in Greenwich Village, maybe a mile from the epicenter of this tragedy. And yes, I know that people talking about pulling jobs and tax-generating businesses out of the city is not a happy thing for battle-weary New Yorkers to hear right now.

But the diffusion of financial entities out of New York and across America seems inevitable, made possible by today's communications systems and made essential by both commercial-space realities and a determination not to build another inviting target for madmen. And, hard though this will be to accept, and swallow for some, probably a good thing, long term, for the nation.