Real Estate Weekly last week covered the recent Associated Builders and Owners of New York luncheon, which was held at The National Arts Club and featured thoughts from Robert Selsam, Senior Vice President and Regional Manager of Boston Properties. Mr. Selsam described his firm’s 250 West 55th Street, which will seek a LEED Gold rating from USGBC. “We want to think of it as a Lever House redux,” Selsam said; as REW noted, both the seminal Lever House at 390 Park Avenue and the new tower were designed by Skidmore Owings and Merrill as glass boxes rising out of a wider podium base. Many, though certainly not all, of the LEED buildings we’ve reported on in Midtown- including 545 and 510 Madison Avenue- will essentially be walls of glass, but the initial renderings of 250 West 55th appear to be a bit more ambitious in their homage to the local history of the International Style. The 38-story tower is expected to receive tenants in time for a 2010 occupancy; demolition and excavation efforts are already underway.
250 West 55th Street will offer 1 million square feet of office space, 25,000 square feet of retail, and will be the first Boston Properties project to seek a LEED rating. (Two of the firm’s more recent local projects, 5 Times Square and Times Square Tower, predated the LEED system). According to Selsam, the firm had initially contemplated an 80-story, hotel and condominium tower for the West 55th Street site. “But we decided it was too risky,” REW quoted Selsam as saying. “We decided (instead) to do what we do best- build an office building.” The tower will boast 10-foot, floor-to-ceiling tenant windows, a roof garden on the third floor, and, similar to the neighboring LEED Gold Hearst Tower, a lobby waterfall. Tenants will enter from West 55th Street- not Eighth Avenue; other specific green design features don’t seem presently available.
As gbNYC noted previously, law firm Gibson Dunn & Crutcher has inked a 220,000-square-foot lease at the tower already, and REW reports that “a host” of other tenants are close to deals too. Another high-profile law firm, Proskauer Rose, will likely take between 500,000 and 600,000 square feet. In a stroke that, given the market downturn, now seems brilliant, Boston Properties targeted the project at law firms rather than financial services tenants, which require far bigger floor plates than the 22,000 square feet at 250 West 55th Street. Interestingly, REW reported that Selsam responded to a question from the audience regarding the current state of the market by saying that “we have not seen a rise in concessions and a fall in rents. We haven’t seen what we thought we’d be seeing. . . . We have no trouble keeping our spaces leased.” Specific figures on asking rents aren’t available, but sources say each was well into the low $100s per square foot.
Beyond the continued green transformation of the Eighth Avenue corridor, from the New York Times Tower north to Hearst Tower and the Argonaut Building, it’s instructive to observe the different types of tenants that green buildings across Midtown are aiming for. From boutique financial services firms at buildings like 510 Madison Avenue, to law firm-specific spaces at 250 West 55th Street, the constant among all of these Class A spaces is the triple digit rents, which, as Mr. Selsam suggested, don’t appear to be ready to abate. One other constant, of course, is that almost all of these new buildings- whether in Midtown, downtown, or even New Jersey- are implementing green design features in one capacity or another. It’s unclear whether tenants are driving the demand for sustainability, but there seems to be little question that, at least in the commercial office context, a local market transformation is indeed well underway.