Dec. 5 (Bloomberg) -- Larry Silverstein has formal proposals from two potential tenants for 3 World Trade Center, which if accepted would allow the developer to build the skyscraper to its full 80 stories, two people with knowledge of the negotiations said.
Group M, a division of WPP Plc, the world’s largest advertising company, and law firm White & Case LLP have sent statements saying they are interested in taking as much as 1.1 million square feet (102,000 square meters) combined at the tower, said the people, who asked not to be named because the talks are private. No terms have been agreed upon, they said.
Silverstein, founder of Silverstein Properties Inc., has discussed capping the building at seven stories if anchor tenants aren’t found quickly enough, two people with knowledge of his position said in January. He must fill at least 400,000 square feet at the tower, which is slated to have 2.8 million square feet, before the Port Authority of New York and New Jersey will help him finance the project.
White & Case has expressed interest in taking about 500,000 square feet, while Group M is looking at 550,000 to 600,000 square feet, according to the people familiar with the plans.
It’s “public knowledge” that Group M has been considering relocation options, said John Wolfe, a spokesman for the firm. “At this time we have no comment on the status of any specific negotiation.”
Francine Minadeo, a spokeswoman for White & Case, said, “We don’t comment on this kind of speculation.” Bud Perrone, a Silverstein spokesman, declined to comment.
Silverstein has rights to develop three of the four towers planned for the 16-acre (6.5-hectare) site where the original World Trade Center stood before its 2001 destruction by terrorists. Four World Trade Center, the smallest of the buildings, is scheduled to be completed late next year. He also is constructing the base of 2 World Trade Center, the second-tallest, which won’t be developed to its full height until market conditions permit.
The site’s tallest building, the 1,776-foot (541-meter) 1 World Trade Center, is being developed by the Port Authority and the Durst Organization.
It’s a challenging environment for finding new tenants. New York’s financial companies have reduced staff and trimmed office space. The 81-year-old developer said earlier this year that he was “optimistic” that he’d be able to sign a 3 World Trade Center lease in time to complete the tower in 2015.
The terms of a 2010 agreement require Silverstein to raise at least $300 million before he can qualify for $200 million each of support from the Port Authority, New York City and New York State, as well as $1.3 billion of tax-advantaged Liberty Bonds and other financing.
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