http://www.nypost.com/seven/02102009...311.htm?page=2
Boston Properties' "suspension" of its plan for a 1 million square-foot office tower at 255 W. 55th St. is of course bad news for Eighth Avenue, which now adds the site to its growing collection of empty holes.
It's also bad for Mort Zuckerman's company, which must decide how to salvage a mess that's cost it over $400 million to date.
(Boston is completing the foundation, so it won't resemble the messes others have made nearby.)
But law firm Proskauer, Rose's decision not to sign a 400,000 square-foot lease there - the reason for Boston's halt - might be good news of a sort for Gibson, Dunn & Crutcher, another law firm that signed a lease in January 2008 for 200,000 square feet in the tower.
Insiders said the lease was inked at over $120 a square foot. In data released yesterday, Jones Lang LaSalle reported asking rents have since fallen to below $90 a square foot, a figure much higher than tenants are likely paying.
What's more, Gibson, Dunn's move from 200 Park Ave. (the MetLife Building) would also have cost it up to $250 a square foot for the buildout at its new home.
Gibson, Dunn - which reported a 1.3 percent dip in per-partner profits last year - has a lease at MetLife until the end of 2011, when its lease is up. It might enjoy not having to spend a fortune on a glamorous new home.
Calls to Partner-in-Charge Robert Serio and to the firm's broker, CB Richard Ellis' Lewis Miller, were not returned.
But some brokers argue that Boston's indefinite delay will help shore up the battered office market.
Jones Lang LaSalle's Peter Riguardi, who was not involved at Boston's site, said, "Emotionally, you're disappointed, because you want to see progress and new buildings on Eighth Avenue.
"But, short-term, we have enough product available and more is becoming available. This setback will force these law firms to consider the existing product, which is beneficial on the whole."
Of course, one developer might be han kering to lure Gibson, Dunn to its own new tower - SJP Properties, which needs tenants for 11 Times Square.
A call to SJP Chairman Steven Pozycki wasn't returned.