NEW YORK -- The destruction of the World Trade Center has sent brokerages and other companies in New York's financial district scrambling to find space elsewhere in the city, in New Jersey, and even in Connecticut.

Even as the smoke from Ground Zero drifts over Wall Street, the question increasingly being asked is: When, if ever, will those dispersed firms return to the financial district?

Up to 15 million square feet of prime office space was destroyed when the twin towers collapsed, instantly creating a shortage of commercial space in Manhattan, and sending firms far from the traditional financial district. Many are pushing to have the towers rebuilt, but that or any other commercial real estate project will take years to complete.

Other prime office space near the site of the attack may have escaped with superficial damage. But it's estimated that it will take months to remove more than a million tonnes of debris, meaning that any tenants in nearby buildings would have to endure a constant reminder of the deaths of thousands.

"I don't think downtown will ever recover. It is painful to be there, to see what's not there any more," said Mark Thompson, managing director of real estate firm Plymouth Partners Ltd. His firm said five million square feet of office space may vanish forever.

And there is the fear that massive skyscrapers will again become a terrorist target.

Yet, the mood among the brokers -- echoing that of the entire country -- is one of defiance. "We remain committed to Manhattan," said a source at one brokerage that has been forced to move part of its operations from the financial district.

New York Governor George Pataki echoed that sentiment: "New York City is the business capital of the world."

Some are pushing to have the site of the attack turned into a permanent memorial to commemorate the victims of Tuesday's terrorist attack. "On an emotional basis, all of us say 'Let's rebuild those beautiful towers,' " Charles Gargano, chairman of Empire State Development Corp., told a New York television station.

New York Mayor Rudolph Giuliani told CNN he is pulling together a group that will meet over the next month to come up with a plan to rebuild the devastated area. "I would caution people not to make an immediate decision. There's too much emotion right now."

But Mr. Gargano said the attack may have irreversibly damaged the bedrock at the site, making it impossible to rebuild the twin skyscrapers. Even so, he said, the south tip of Manhattan Island will remain the locus of the capital markets. The diaspora of brokerages to outlying areas will be short-lived, he said. "I'm confident it will be on a temporary basis."

Mr. Thompson disagreed, saying that areas such as Midtown Manhattan, New Jersey and Brooklyn will become permanent homes for many. He said there has been talk of converting residential buildings back into office space. But he said such buildings, often dating from the first half of the 20th century, aren't suitable for modern business, unable to accommodate modern telecommunications systems.

It's more likely that Midtown Manhattan will become a permanent home for some brokerages, offsetting the effects of the dot-com implosion. Internet companies, centred in that part of the city, left more than a million square feet of office space vacant.

Other observers said the dispersion of Wall Street this week simply accelerates the arrival of a virtual financial community, something that the Nasdaq Stock Market already exemplifies. "Wall Street is becoming more of an electronic business," said James Park, a trader for brokerage Brean Murray & Co. "It's nice to go down to the exchange; there's a certain nostalgia. But times change, and this event suggests we need to re-evaluate what happens in terms of security and where things are."