Tough economic times have punctured the optimistic rent projections at the 40-story speculative office tower, 11 Times Square.
Steven Pozycki, chairman of development firm SJP Properties, was quoted in January 2008 saying that the cheaper floors in the 1.1 million-square-foot building rising at the corner of Eighth Avenue and 42nd Street would command rents of $100 per square foot.
Today he told a crowd gathered at a B’nai B’rith luncheon at the Cornell Club in Midtown that he would be satisfied with rents that are about 25 percent lower per square foot.
“We would like a $100 [per square foot] rent but we would be real happy with a high $70 rent. So that is the kind of range that would give us a nice yield on the property,” he said.
He added that he expected the first lease to be signed by the end of the year. Meanwhile, in January last year, he said he expected half the building to be leased by the middle of 2008.
There were rumors in January that law firm Proskauer Rose was looking at space in 11 Times Square, but last month Real Estate Weekly reported that it was renegotiating at its current location at 1585 Broadway.
The decline in the expected rents at 11 Times Square are in line with the city conditions overall. Average Midtown asking rents by April had fallen 31 percent from early 2008 to $57.23, according to real estate firm Newmark Knight Frank.
Stephen Siegel, chairman of global brokerage for CB Richard Ellis, which is handling leasing for the building, said in an interview after the lunch that the average rent could still hit $100 per square foot once the building is fully leased.
“I still think we could arrive at or near that with the tower floors,” he said, adding that the building was expected to be completed this fall.