The Real Deal New York

TAMI tenants pose new challenges for WTC towers

New-age tenants require less space, which leaves buildings vacant longer

January 08, 2015 11:37AM

One World Trade Center

One World Trade Center

Although financial firms filled the original twin towers, One and Four World Trade Center are attracting a new breed of tenants: technology, media and advertising companies.

These companies often need less office space, however, leaving relatively more space vacant in the massive towers. At the current rate of leasing, the towers won’t reach 95 percent occupancy until 2019.

Most new tenants, including One World Trade’s anchor, Condé Nast, have come from the creative sector. Gaming company High 5 has also signed a lease there, indicating that the area is becoming “much hipper,” according to Bloomberg.

And at Silverstein Properties Four World Trade Center, MediaMath inked a lease for 106,000 square feet, making it one of the largest tenants in the building.

Currently, roughly 3.3 million square feet — including the 1.2 million square feet that is occupied by Condé Nast — has been leased out at the pair of buildings. While financial firms made up 80 percent of the office space in the twin towers, they make up 1.3 percent of current tenants, according to Bloomberg. TAMI tenants — which took about 3 percent at the old World Trade Center — have taken up roughly 33 percent of the tower’s space so far. Government tenants occupy roughly 40 percent.

“People were expecting financial companies to be a substantial portion of the leased space,” Christopher Jones, vice president of research at New York’s Regional Plan Association told the website. “I don’t think many people would have thought that it would be virtually nothing.”

One World Trade Center opened in November. Roughly 2 million square feet are still vacant at both One and Four World Trade Center, the first two towers to reopen at Ground Zero after the September 11, 2001 terrorist attacks. [Bloomberg News] — Claire Moses

 

  • DTNYC

    Please stop the hysterics! For a building to open almost 65% full is pretty darn good. And the statement that “at current rates leasing won’t reach 95% occupancy until 2019” is ridiculous though technically true. The rates will rise dramatically as the WTC Transportation Center opens with the full mall and Eataly underneath, Brookfield Place with all of its stores and restaurants and Saks Fifth Avenue, the retail at Fulton Center opens, Pier 17 and the iPic movie theater opens and all the new restaurants open, leasing will pick up dramatically. That’s just common sense and it IS what will happen. Look for 2 WTC to get its anchor tenant shortly.

  • David Brown

    I think the question is the financial sector not tenancy of individual buildings. The Dodd-Frank regulations etc are driving down return on investment and forcing offsetting cost reductions. NYC is a high cost provider of space. Ultimately it is not a question of moving to Brooklyn to save 10% but of moving to Dallas to save 40%. NYC will remain a global financial center but massive office towers require tens of thousands of back office workers, not dozens of hedge fund professionals. As leases expire the major financial companies will continue to downsize NYC space.

    • WannaBeLandlord

      On the money. Goldman’s office in Salt Lake City is rapidly growing. Mormon’s work hard, and don’t party.

  • O[b]ama

    Ground Zero is the World Transportation Center, epicenter of America’s new, ever-expanding, universal, self-driving-car infrastructure.

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