By Roland Li
On Sept. 11, 2001, Tara Stacom of Cushman & Wakefield was walking to work on the east side of Fifth Avenue. She saw pedestrians gazing south, and began hurrying to Cushman’s offices in midtown. In the following weeks, she hardly saw daylight. Instead of reading the news, she poured over building documents and leases, searching for space for her client, the Bank of New York, which had virtually all of its employees displaced by the attacks.
Remnants of the recent dot-com bust meant that there were huge pre-built office spaces, with desks and phones still in place. For the former tenants, such availabilities were a boon.
“It became, in some respects, a race,” said Stacom, who is now a vice chair at Cushman. Ultimately, Bank of New York took 1 million s/f in around 10 new locations. Often, deals were done with a handshake or verbal agreement.
“Everybody was very good and true to their word,” said Stacom. “It was a wonderful experience in our industry to watch everyone lock arms and help.”
A decade later, Stacom and a team from Cushman are responsible for leasing One World Trade Center, perhaps the most prominent tower in the world. But it was critical to separate the building’s symbolism and its reality as 3 million s/f of new, green, Class A office space. The first step was changing the name from the Freedom Tower, a name rife with symbolism, to One World Trade Center, which restored its commercial nature.
For Condé Nast, the building’s new anchor tenant, access to transit was a crucial factor, said Stacom. After conducting traffic analysis, they realized that commutes to the World Trade Center were favorable, even compared to midtown, partially because of access to New Jersey and Brooklyn. The details of the lease presented further complexities, including security concerns and the creation of a cafeteria, but were eventually resolved after almost a year of negotiations.
In addition to the office space, the Westfield Group recently partnered with the Port Authority for control of the retail space, which is dispersed throughout the complex, creating a “Rockefeller Center on steroids,” as Stacom puts it. The shopping and dining are another asset for leasing the building, giving office tenants more reason to desire the area.
Stacom said that tenants are also attracted by the building’s floor-to-ceiling glass, which bathes 90% of the floors in natural light. Column-free structure – a result of the resilient concrete core – allows for open offices, a favorite of media companies. Currently, the leasing team is seeking deals for entire or multiple floors, ranging from 200,000 to 400,000 s/f. It is, however, in talks for deals that are both larger and smaller.
“Over time, we’ll start splitting floors,” said Stacom.
Tenants through the city and the world have expressed interest, with international companies particularly drawn to the building’s green features, which are built for LEED Gold certification. Most of the tower will be steam-heated, and a rainwater collector will contribute to cooling systems.
Beijing Vantone Industrial Co. was the first private tenant for the building, signing a 20-year, 190,000 s/f lease. The real estate company hopes to build a China Center in the space, which will attract other Chinese companies.
The decade since 9/11 has seen a diversification of the downtown tenant base, with government now the biggest occupant. Media companies and professional services have grown, while financial firms have a smaller percentage of the overall office market. The more varied tenant base allowed the area to weather the recession, and its vacancy rate remains comparable to that of midtown.
The tightness in vacancy of midtown south will lead to increased rents at downtown, which are currently in the low $40s per s/f, said Stacom. In addition, the Trade Center now has an advantage of having an anchor tenant and a stable construction schedule, something that few ground-up office projects in the city have.
She credits the Port Authority for its leadership on the project, as well as the Durst Organization bringing its expertise from the development of One Bryant Park. And there’s no doubt that the Cushman team, which has been on the project for 2007, has a particular connection to the World Trade Center’s rebirth.
“We’re very proud to be associated with it,” she said.
