Law firm taking its business to The New York Times?
After posting disappointing earnings in recent months, The Times has been eager to lease some of its space in what has become a lucrative option for the paper given the meteoric rise of Manhattan office rents. The Times is asking for rents in the $80s per s/f for the space. The New York Times Building has been a magnet for law firms.
Forest City Ratner took its portion of the 1.5 million s/f tower, floors 29 through 50, from tenantless to full occupancy by completing a string of deals that began with Seyfarth Shaw's 100,000 s/f lease last June. Covington Burling took 160,000 s/f later that month just before Canadian law firm, Osler, Hoskin & Harcourt LLP, signed on for 60,000 s/f in July. The last deal in Ratner's portion of the building was a 200,000 s/f deal with Legg Mason in August. Now less than 100,000 s/f remains. Despite the building's tenant roster, Goodwin Proctor's potential deal left some brokers calling it odd that the firm would be able to shift so quickly from prime space on Sixth Avenue to the space it is now considering on Eighth Avenue. Although office districts continue to expand westward, some real estate experts continue to question whether West Side space will always mesh with the office cultures of tenants used to residing in Manhattan's prime office corridors.
Goodwin Proctor may have little choice given the scarcity of space in midtown. The firm seemingly had a deal for 238,000 s/f at 1095 Avenue of the Americas. But when the building's owner, Equity Office Properties, was purchased by The Blackstone Group in a record $19 billion acquisition in recent weeks, the new landlord increased rents by as much as $10 per s/f. The rent spike also thrust a major deal with MetLife in the building into uncertainty. That lease, which could be as large as 600,000 s/f, is said to be back on track, according to sources with knowledge of the negotiations who indicated that MetLife indeed may have had to pay stiffer rental rates.
Studley represents Goodwin Proctor. Both The New York Times Building and 1095 Avenue of the Americas are represented by CB Richard Ellis.
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|Publication:||Real Estate Weekly|
|Date:||Dec 27, 2006|
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