Proskauer Rose signs on
This week prominent law firm Proskauer Rose signed an office lease for more than 400,000 square feet at the vacant 11 Times Square (at the intersection of 8th Avenue and 42nd Street). The firm is one of the largest law firms in the United States, and was founded in 1875. Currently they have 11 offices worldwide.
The state-of-the art 1.1-million-square-foot tower is currently vacant — Proskauer Rose is its first tenant so this is a major coup, and sign of confidence in the market. This significant deal follows on the heels of Uniqlo’s $300 million lease a few weeks ago, and has the media speculating that these two deals firm up the belief that the commercial freefall may just be over.
SJP Properties bought the land for 11 Times Square for $325 million in 2006 and started construction on the tower in 2007. According to a PR Newswire press release, the Proskauer lease “represents the largest office relocation in Midtown Manhattan in more than two years.” They will occupy floors 17 through 30 of the 40-story tower.
Attracted to building’s green qualities
One of the building’s attractions is its Leadership in Energy and Environmental Design (LEED) Gold certification. “Through the incorporation of advanced air filtration technology, 11 Times Square brings in air 600 feet above street level, which is then filtered 30 percent above LEED Gold standards, allowing personnel to breathe cleaner air and greatly improving the quality of life within the building.”
Not much is being built in the Manhattan market to possibly compete with 11 Times Square, as new construction ground to a halt in the past few years. The builder believes the project will be complete next month, and Proskauer Rose will move in sometime in 2011.
Taking advantage of reduced rents
With the signing of Proskauer, other professional firms are predicted to follow suit. According to a New York Times article (5/8/2010), the developer is “negotiating with several companies who want to build an aquarium filled with sharks, rays and penguins on the lower floors of the building.” Nobody knows if that proposed tourist attraction will draw enough financing.
In the same NYT article: “Brokers say that Proskauer will pay about $75 a square foot for floors in the middle of the tower on 42nd Street, about 30 percent less than what the developer had hoped to get in 2008.”
Is the recession in our rear view mirror? The media seems to think so, despite mixed signals in the market. The serious rent reductions from 2007-2008 peak numbers don’t hurt, either.
Image courtesy Francisco Diez via Flickr
Benn Rosales
May 19, 2010 at 9:09 pm
It’s certainly a hopeful sign, and it certainly lends to the ‘why aren’t we’ mentality that happens when competitors make a move in the market that is substantial. When others are cowering away from fear, others are striking while the iron is hot. Let’s hope for a snowball effect.