The dramatic transformation of Times Square from a seedy district infamous for porn shops and massage parlors into a thriving retail and entertainment destination where tourists crowd the streets and look skyward is legendary. It's a wonderful success story of how the public and private sector can work together to re-energize a city.
Lost in all the discussion about the “Disneyfication of Times Square,” however, is the strength of this burgeoning office market, which thrives on a diverse mix of tenants in fields such as entertainment, media, financial services, consulting and law.
What's more, the Times Square office market has emerged as a pioneer on the green building front. The catalyst was The Condé Nast Building at Four Times Square, a 1.6 million sq. ft. tower located on Broadway, between 42nd and 43rd streets. The 48-story building was completed in 1999 by The Durst Organization. Back then, it was the first speculative office building to have been developed in New York in nearly a decade.
What made this project unique? Four Times Square was the first building of its size and financial structure (multi-tenanted and not owner-operated) in the U.S. to adopt standards for energy efficiency, sustainable materials, and indoor environmental quality, according to the U.S. Department of Energy. The building also adhered to responsible construction and maintenance practices.
“We obviously went green before there was a standard for green,” says Thomas Bow, senior vice president with The Durst Organization. “We really learned that you could build a large-scale project from a sustainable and environmentally responsible perspective.” That knowledge was collected by Durst and set down in a book, Lessons Learned: Four Times Square — An Environmental Information and Resource Guide (Earth Day New York, 1998).
Durst parlayed that experience into the $1 billion development of the 2.1 million sq. ft. Bank of America Tower at One Bryant Park, a 54-story office building that opened a few months ago on the west side of Sixth Avenue, between 42nd and 43rd streets. The tower expects to achieve the first LEED-platinum rating for a commercial high-rise.
Bank of America is the lead tenant and co-developer on the project. The bank will occupy 1.6 million sq. ft. and employ a workforce of 5,000 to 6,000 in the tower. As of early July, all but 30,000 sq. ft. of the 2.1 million sq. ft. of office space had been leased. Gross asking rents per sq. ft. on the 50th floor are $200 and $185 on the 37th floor, indicating strong tenant demand.
The green amenities include a rainwater collection system, plus an indoor-air quality system that filters out any volatile organic compounds. “This is what the bank wanted to build, the best work environment for the employees,” says Bow.
Dan Kaplan, a senior partner with architectural firm FXFowle, says that sustainability ranks high on the list of requirements for major corporate tenants. “For the rest of the world, and especially the European companies that are coming here, this is also a part of their criteria,” Kaplan remarked during a discussion on Times Square as part of the Manhattan Westside Real Estate Conference held June 19 in New York.
But it is not just the Europeans — it is also a generational shift that is ushering sustainability into the mainstream. When Stephen Siegel's daughter recently filled out a college application, she was asked to list five words that best describe her. One of the words she included was “green”. The chairman of global brokerage for CB Richard Ellis shares that story to drive home his point: Businesses that fail to offer a green environment for their employees will find it tough to recruit young workers.
“There are now benchmarks that are actually beginning to be available that prove the higher productivity, the better work environment” that green buildings generate, remarked Siegel during the Times Square panel discussion. “Even if it that means a slight premium in rent for the tenant, it can be demonstrated now that there is a [measurable] payback,” added Siegel.
Robert Selsam, regional director of the New York office for Boston Properties and a panelist, has observed a shift in green awareness. His company developed Five Times Square. Selsam says that today's tenants ask, “What's your LEED rating?” Just a few years ago, they were asking, “What is a LEED rating?”
Contact Editor-in-Chief Matt Valley at matt.valley@penton.com.