Posted Mar 25, 2012, 2:44 PM
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New Yorker for life
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Join Date: Jul 2001
Location: Borough of Jersey
Posts: 51,692
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Quote:
Originally Posted by Onn
Maybe the bigger question is why wasn't Tower 2 built before the others? At the rate we're going its never going to be built period. If you can't fill Tower 4, Tower 3 isn't going to be built, and Tower 2 has no chance at all. This going from smaller to larger strategy makes no sense here. Even if he had to take a major loss on Tower 2 it would have been made up in the rising real estate value of the tower once it was complete. That's why tenants have bought into Tower 1, they know the tower will rise rapidly in value being the tallest in the city.
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For answers to your tower 2 questions, check the tower 2 thread.
http://www.crainsnewyork.com/article...TE02/303259985
Wanted: a few huge tenants
Developers hunt for that special someone to get projects going.
By Theresa Agovino
March 25, 2012
Quote:
It's a very exclusive club, with about 12 huge, closely watched, highly coveted corporate members. Each has the power to have a potentially major impact on the city's skyline for years to come.
They are the kingmakers, mega-tenants such as Credit Suisse, L'Oréal and Viacom. Each faces a major lease expiration in the coming years that gives it the power to transform building plans into concrete and glass by agreeing to become a tenant. With the real estate industry keen to shake off its recession-induced slump, such tenants are being vigorously courted by a trio of developers eager to get their proposed towers built.
“We know who everyone else is talking to,” said Jeremiah Larkin, senior vice president of leasing at Brookfield Office Properties. He is seeking tenants for the first two of a total of four towers that Brookfield plans to erect on a site just west of Penn Station. The company has said that it needs to lease 800,000 square feet before it will start putting up a tower. In the meantime, the developer this summer will start building a platform over the rail yards that is necessary for the project to proceed.
Farther west, The Related Cos. faces a similar task on an even grander scale. It is looking to lease 1 million square feet of office space so it can build an even bigger rail-yard platform for what will be the developer's second office building there. Late last year, the company snared Coach as the anchor tenant for its first tower at the Hudson Yards, the only one that doesn't require a platform.
Both developers face major competition from Silverstein Properties, which has the right to build three office towers at the World Trade Center site. Larry Silverstein's edge, even competing brokers concede, is that he has something to show tenants: rising buildings. The developer's first tower stands just eight floors shy of its planned 64-story full height and is slated to be completed next year. But in order to construct the second tower, Silverstein needs to lease at least 400,000 square feet. Without that, the planned 80-story edifice will be capped at just seven stories sometime in 2013.
Time is crucial for the developers if they want to land a tenant whose lease expires in 2015 or 2016, such as L'Oréal, which is seeking about 500,000 square feet, or Viacom, which needs about twice that. To allow enough time for construction, a lease should be signed by the end of this year for a tenant whose current lease runs out in 2015. In Related's case, it needs a company that can afford to wait until 2017.
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