Trade Center Rents Will Rival Midtown, Silverstein Says
Office rents in the new towers at lower Manhattan’s World Trade Center will rise to levels “very close” to those for high-quality spaces in Midtown, said Larry Silverstein, who is building one of the skyscrapers.
“The price at the World Trade Center will become very close and will become the equivalent of midtown Manhattan,” Silverstein said today in an interview with Deirdre Bolton on Bloomberg Television’s “Money Moves.” “The discount is going to disappear for this quality real estate.”
Silverstein, 81, is developing 4 World Trade Center, a 72- story skyscraper that is the shorter of the pair under construction at the site. The Port Authority of New York and New Jersey is building the 1,776-foot (541-meter) 1 World Trade Center. Leasing costs downtown have traditionally lagged behind Midtown, where financial firms have paid some of the highest office rents in the U.S.
Silverstein has about 1.2 million square feet (111,000 square meters) left to lease in 4 World Trade Center, which is slated for completion by the end of next year. The Port Authority, which has teamed with developer Douglas Durst on 1 World Trade, has about 1.4 million square feet unrented and is scheduled to open in early 2014.
Tenants will be attracted to the state-of-the-art technology and sustainable architecture of the towers, Silverstein said in the interview.
While financial companies have been delaying leasing decisions until they get a better sense of future taxation and regulation levels following the U.S. elections, Silverstein said he’s not counting them out.
“The conventional wisdom would be to forget about the financial firms,” he said. “Conventional wisdom doesn’t always hold true.”
Asking rents for offices in Midtown averaged $66.42 a square foot at the end of the third quarter, Cushman & Wakefield reported on Oct. 2. Rents in lower Manhattan averaged $40.06 a square foot.
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