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New York’s 7 WTC close to signing first tenant

July 25, 2005

By Ilaina Jonas

NEW YORK (Reuters) – The first building to go up as part of
the reconstruction of New York’s World Trade Center is close to
signing a lease for its first tenant, a source familiar with
the deal said on Monday.

American Express Financial Advisors, soon to be spun off by
parent American Express Co., is near to signing a deal for
20,000 square feet of space, or about half a floor, of 7 World
Trade Center, a 1.7 million-square foot building that is set to
open soon, the source said.

Bud Perrone, a representative for World Trade Center
developer Larry Silverstein, declined to comment. A spokeswoman
for American Express Financial Advisors could not be reached
for immediate comment.

Seven World Trade Center was built next to the Twin Towers
site. On Sept. 11, 2001, the fire that engulfed the towers
spread to 7 WTC and destroyed it, too.

The new tenant probably be located close to the 38th floor,
where Silverstein will have his offices. Also, CB Richard Ellis
Group Inc., the broker for the building, will be moving its
downtown New York office to the building from One Liberty
Plaza, the source said.

The asking rent is about $50 per square foot but incentives
reduce that by about $15 per square foot.

At the end of June, the difference between asking rents in
midtown and downtown reached its widest margin ever — nearly
$17 per square foot higher in midtown. The spread was even
greater when concessions such as free rent, improvements and
incentives were taken into account, according to brokerage
company Cushman & Wakefield.

Overall downtown rent was about $31.20 per square foot in
the second quarter, compared with $47.87 in midtown, according
Cushman & Wakefield.

The 7 World Trade Center building, which has been completed
but has not yet opened, cost $1.36 billion, including $839
million for construction and $516 million to pay off an
existing mortgage.

New York Assembly Speaker Sheldon Silver, one of the most
powerful politicians in the state, represents the area and has
called for a series of tax breaks and other incentives for
lower Manhattan to jump-start the rebuilding of the World Trade
Center site.

Silver was able to kill the proposed West Side Stadium, a
pet project of Mayor Michael Bloomberg, saying the development
it would spark there would compete too strongly with lower
Manhattan.




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