The Real Deal New York

City puts freeze on lease deals for
its agencies

Officials might fear impact of federal cuts
April 11, 2017 08:45AM

The city is holding off on letting its agencies lease space at new and existing offices — a possible sign that officials are waiting to see the impact of federal cuts before committing to long-term deals.

Stalled deals include the Human Resources Administration’s expected renewal of 264,358 square feet at Gould Investors’ 109 East 16th Street, the New York Post reported. The starting rent in the building is $76.83 per square foot but that’s expected to increase over the next couple of years. The Department of Investigation was also supposed to take 275,000 square feet for a new space at 180 Maiden Lane, but the city won’t give final approval to this and other deals, such as leases for the NYPD, HRA and Sanitation Department at 375 Pearl..

The Post posits that the city is delaying committing to these big leases until it’s clear how cuts proposed by President Donald Trump play out in the city.

Cathy Hanson, a spokesperson for the Department of Citywide Administration Services, said that there isn’t a specific blanket suspension of leasing deals.

“There is no across-the-board moratorium on leases,” she said. “We are working with agencies on a case-by-case basis to reassess their space needs.”

Still, the sudden halt of these deals has some landlords and tenants frustrated.

“Deals are pending all over the place that owners and agency heads had thought were done,” one source told the Post. [NYP]Kathryn Brenzel