Strange things happen to people when they're caught up in a boom -- they tend to think that it just might go on forever and make their plans accordingly. All memories of recession are conveniently wiped out, to be replaced by an "onward and upward" mind-set.

The property market is no different. Developers, like everyone else, lose the run of themselves in a scramble to build more and more commercial and retail space, confident that it can all be let at top-dollar rents and sold on to financial institutions at a handsome profit.

In Dublin, there seemed to be no end to the demand for office space - not just in the city centre, but also in Docklands and in a variety of edge-city office parks. Most of these developments were speculative, though based on confident expectations of securing occupiers.

Last year witnessed a record output of new office space in the Dublin area, amounting to 2.4 million sq ft. But even before the World Trade Centre was attacked on September 11th, demand was already slackening and, with it, the output for this year.

"September 11th made everyone shake in their boots," as one seasoned practitioner put it. For obvious reasons, some to do with security fears, all high-rise projects have been "put on hold" and will only proceed when confidence returns to the market.

Among the likely casualties is the overblown plan by CI╔, Trinity College and developer Bernard McNamara to redevelop the area around Pearse Station, Westland Row, for a high-rise scheme of offices, student housing and a hotel with views over Merrion Square.

Dunloe's office tower plan for the corner of Sir John Rogerson's Quay is almost certain to be pigeonholed, at least until the redoubtable Noel Smyth can sign up tenants or, alternatively, dispose of this pivotal site to another developer at a price he would regard as adequate.

Even scaled-down schemes for the west side of Smithfield may now be in some jeopardy. Though demand for city centre apartments remains quite buoyant, there is not much point in developers building large amounts of office space if tenants are not available to fill it.

The banks which fund property development have become much less indulgent with their money than they were last year, or even earlier this year.

Schemes that don't have a guaranteed take-up are unlikely to get funding and will not, therefore, be built in the short-term.

"There's a sense that everyone is holding their breath because of the present uncertainty," in the words of another close observer. Vacancy rates are rising, particularly in suburban office locations, and there has also been a welcome "settling down" of development land prices.

Companies that might have been interested in relocating to, say, edge-city office parks are now staying put. As a result, vacancy rates in office parks - particularly on the northern and western outskirts of the city - are high and investors who sank money into them are taking a hit.

"It has become much harder to persuade people to move and estate agents are at their wits' end thinking up ways to induce them," according to one well-informed source. "Developments that were designed for the 'big bang' will now have to be carefully phased."

Scaling back the size of projects has now become commonplace, especially in the technology sector. Novell, the US network software company, will now be taking up only half the space in a seven-storey office block earmarked for the old gasometer site in Docklands. But Peter Coyne, chief executive of the Dublin Docklands Development Authority, remains sanguine about the prospects.

"We have an underlying sense of optimism here, not least because Docklands is a city centre project - and the city centre will always be in demand."

The DDDA's current plans envisage some 4,000 apartments and nearly five million sq ft of commercial (mainly office space) in the North Docks area and a further 3,500 apartments and some 3.2 million sq ft in the Grand Canal Docks.

"We expect to continue rolling it out," says the unflappable Mr Coyne. "There are still large players looking for space in both of these areas. They may not be kicking the door, but they're just behind it." His sense is that the market has "not gone to sleep, it's just a bit quiet."

During this lull, the DDDA is forging on with its "infrastructure-led" approach. The lengthy process of decontaminating the main gasworks site in the Grand Canal Docks has now been completed and tenders have been invited for a large underground car-park in the area.

Work is also proceeding on the campshires and, finally, on the Stack A warehouse in the Custom House Docks - a piece of unfinished business left over from the early days of redeveloping Docklands. Market interest will also play a role in deciding on its eventual mix of uses.

But Peter Coyne says no analogy can be drawn between the current situation facing the DDDA and the tough time its predecessor had in getting Docklands off the ground in the late-1980s and early 1990s. "Dublin's whole business and economic environment is different."

The DDDA's area action plan for the North Docks, stretching from the IFSC extension to the Point depot, is expected to be approved shortly by the Minister for the Environment, Mr Dempsey, possibly with some amendments - including an increase in density at Spencer Dock.

In the present economic environment, however long it lasts, the abortive scheme championed by Treasury Holdings for Spencer Dock, involving six million sq ft of office, commercial and residential space, seems even more unimaginable than it did two years ago.

Nonetheless, the brownfield sites available in Docklands offer the only prospect for large floor plates in the centre of Dublin. This matches the needs of corporate tenants such as PriceWaterhouseCoopers, which signed up two months ago to take 200,000 sq ft at Spencer Dock.

Treasury, in partnership with David Arnold, took an each-way bet on edge-city office development by planning Central Park in Leopardstown.

But its 1.7 million sq ft of office space will take a lot longer to materialise than originally envisaged. The net effect of the current uncertainty in the market is that it will take longer to implement all of the "big plans" hatched during the Celtic Tiger era - in the case of Docklands, up to 15 years instead of 10. But at least everyone now has more time to think and to refine their plans.