Boston Properties challenged to fill Midtown spec tower
Boston Properties has struggled to lease up its office tower at 250 West 55th Street in the Columbus Circle area, with the real estate investment trust needing to fill at least another 250,000 square feet before the building begins to turn a profit.
“It’s taken a heck of a lot longer to get it leased than I would have thought,” Michael Knott, an analyst at Green Street Advisors, told the Wall Street Journal. “It’s been a suboptimal development with 20-20 hindsight.”
The 900,000-square-foot office tower – where Boston Properties restarted construction in 2011 — is only about 50 percent leased so far. Robert Selsam, head of Boston Properties’ New York office, admitted to the newspaper that “we’d always like leasing to be quicker and get higher rents. Sometimes you have to be patient, and our patience is paying off.”
Indeed, the REIT is in talks to bring Middle Eastern media giant Al Jazeera to the building in a 200,000-square-foot deal, and is also in discussions with the investment firm of billionaire George Soros to take 75,000 square feet.
Many other new-construction office buildings, Such As 51 Astor Place and 11 Times Square, have found it tough to sign tenants to large space. As of September, Downtown had five of the 10 largest office spaces on the market, as The Real Deal reported. [WSJ] – Hiten Samtani