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First Private Office Leases Signed in Lower Manhattan

By Alan J. Wax

November 20, 2001

As a flood of new office space hits the lower Manhattan market, some of the first private office leases downtown since the terrorist attacks on the World Trade Center have been signed.

But commercial property brokers said the recent deals would have minimal impact on filling available space downtown, where about 4 million square feet of space has been made available for sublet by financial services firms hit by the economic downturn.

Recently concluded deals include leases by:

The New York Stock Exchange for corporate offices at 14 Wall St. for 64,884 square feet at 14 Wall St. for staffers who formerly worked at Two World Trade Center.

Fleet Meehan Specialists Inc., an NYSE specialist brokerage, which took 33,108 square feet in the same building.

Parsons Transportation Group, a unit of the Pasadena, Calif.-based international engineering company, which leased four full floors totaling 64,284 square feet of space for its New York headquarters at the landmark 100 Broadway. Parsons Transportation is at 110 William St., also downtown.

Union Bank of California, which signed for 25,000 square feet at 40 Wall St., owned by Donald Trump.

In addition, brokers at GVA Williams recently completed two deals downtown, but specifics were not available. Officials there declined to comment.

Despite these deals, the downtown office market remains troublesome.

"We are now counting more than 25 blocks of space in excess of 100,000 square feet available," said M. Myers Mermel, president of Tenantwise.com, the online office brokerage that negotiated the Union Bank transaction.

In the two months since the attacks, the downtown market for top-quality office space lost the gains it made during the past two years, according to commercial property brokers Grubb & Ellis Inc. At the end of last month, the area's Class A office vacancy rate was 8.5 percent, a level not seen since the third quarter of 1999.

Property brokers said prospective downtown tenants are holding back on decisions until they see what incentives government officials offer.

"At this time, the whole mood downtown is wait and see," Bruce Surry, who heads the downtown office of Insignia/ESG, said. "Everyone is waiting to see the extent of the benefits."

A package of incentives pending in Congress would offer tax credits worth $4,800 per employee for two years to companies that remain downtown.

The NYSE's new space is opposite the NYSE's main offices at 11 Wall St. The exchange is taking the 14th and 19th floors as well as part of the 12th floor, in the 37-story, 957,000-square- foot property, built in 1911 and designed by the renowned architecture firm Trowbridge & Livingston.

The NYSE had about 140 enforcement workers at 2 World Trade Center. They were relocated to temporary space at 20 Broad St. and will move next year to 14 Wall St.

The NYSE's plans to build a trading center across from its building were put on hold after the Sept. 11 attacks.

Newmark & Co. Real Estate Inc.'s Ronald Goldberger and Michael Levy represented the landlord of 14 Wall St., W12/14 Wall Street Acquisition Associates LLC.

Parsons, which is taking space abandoned by a failed dot-com in the landmark 100 Broadway, "is demonstrating its desire to be an active participant in major engineering projects that will play an important role in this area's rebirth," said Paul Mas, a broker with Colliers ABR Inc., who along with Mark Furst, represented Parsons, a transportation engineering firm.

Most of the major leases downtown since Sept. 11 have been signed by government agencies, including the Securities and Exchange Commission, which leased 140,000 square feet in the Woolworth Building, and the state Court of Claims, which took 37,000 square feet at 26 Broadway.

Copyright 2001, Newsday, Inc

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