Thursday, April 13, 2006
7 World Trade Center is a marvel, better than its predecessor. However, it is having trouble attracing tenants. Are the vacancy problems due to terrorism fears? Or is it more of an economic hedge because the rest of the World Trade Center has not yet been finished. Potential tenants might refuse to come to 7 WTC because they don't think that downtown will ever rebound.
Steve Cuozzo is not worried...
Silverstein's detractors can't make enough of the fact that the new 7 WTC has yet to find tenants for most of its 1.7 million square feet.
Omigod - only a few puny deals signed after two years of construction! A mere 60,000 square feet leased out of 1.7 million!
But although Mayor Bloomberg and others have seized on the plight of 7 WTC to argue against commercial reconstruction - and to try muscling Silverstein out of Ground Zero - it's a fool's game to make a mountain out of the project's molehill of signed deals.
For one thing, Silverstein has a term-sheet agreement with Chinese real estate company Vantone for 200,000 feet, and is in talks with others. But what if those deals fall through and 7 WTC is still mostly empty six months or a year from now?
Actually, quite a few Manhattan office towers have gone up without pre-signed tenants in the past 15 years - and all ended up fully leased and thriving by the time they were open or within a year or two later, even if some developers lost the buildings to their banks.
Those projects included 4 Times Square, 505 Fifth Ave. and 610 Broadway (fully or mostly leased at their completion) and three Times Square-area towers that stood empty for a brief interlude before filling up.
Read the whole article here,