Conde Nast better suited to 1 WTC than Midtown: Stacom

TRD New York /
May.May 25, 2011 08:08 PM

“One World Trade Center is now New York’s first address for premier corporate office tenants,” Port Authority of New York & New Jersey Executive Director Chris Ward declared today as he took the stage on the 34th floor of the yet-to-be-finished Freedom Tower to announce Conde Nast’s signing for one million square feet in the building (see photos above). “Already the announcement has generated new interest in 1 World Trade, and let me tell you, the word is now out: See you Downtown.”

Symbolic as today’s signing might be of a transforming neighborhood, many in the real estate industry say the landscape has been changing for a while now. Mary Ann Tighe, who heads CB Richard Ellis’ New York sales region and represented Conde Nast in the transaction, pointed to Sirius Satellite Radio’s widely reported interest in 1 World Trade Center; American Media and the New York Daily News each signing for new space at 4 New York Plaza last summer and Omnicom moving into 195 Broadway in 2007 as signs that the media is gaining a strong foothold in the neighborhood. Meanwhile, between J.Crew and law firm Chadbourne & Parke’s widely reported interest in 1 World Trade Center, WilmerHale’s April signing at 7 World Trade Center and the Gap taking a quarter-million square feet at 40 Worth Street in 2009, it’s becoming a more diversified neighborhood.

But it’s still far different from Midtown, and Tighe pointed to the advantages.

“Conde Nast,” she said in a conference call after the event, “wouldn’t have brought their operations to the area if it wasn’t attractive enough to retain top-tier talent.”

The biggest difference she said, is that more than one-third of all people who work downtown live in the area, too. She noted that the News recently named Battery Park City the best place in Manhattan to live.

The 104-story One World Trade Center, scheduled for completion in 2013, will be the largest building in the area or anywhere in the country for that matter. It’s being developed by The Port Authority and Silverstein Properties at a reported cost of $3.3 billion. The Durst Organization recently purchased a 10 percent stake in the building, which, like Conde Nast’s lease, was finalized today. Conde Nast’s lease for one million square feet across the 20th through 41st floors of the building is reportedly worth $2 billion over 25 years.

Tara Stacom, the vice chairman of Cushman & Wakefield who manages leasing for 1 World Trade Center, told The Real Deal after the press conference that the demographics of the area mesh with Conde Nast better than Midtown did. “For Conde Nast, most of their employees are at the age category in the 20s, so they need subway access, they need the 13 subway lines that come to the site,” she said. “So it just makes it easier for all these types of companies that don’t have the black cars, like the Goldman Sachs’ of the world, to come here.”

Some have speculated that the diversification of the neighborhood would lead Brookfield Properties to change the name of its World Financial Center. But that might be pushing it a little bit too far, Tighe said, noting all the financial services companies that still work in the area. Brookfield Properties was not immediately available for comment.

Mayor Michael Bloomberg agreed. “Make no mistake, Lower Manhattan will always be the global center of finance, that’s its history and its future, as well,” Bloomberg said at today’s press conference. “But if the recent national recession underscored anything, it’s the importance of having a broad economic base that can withstand the ups and downs of any one industry.”

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