High winds scrapped the crowning of One World Trade Center today. The final touches on the spire will eventually make it the tallest building in the western hemisphere. The skyscraper already towers over all other Manhattan buildings, but it stands out for another reason, too.
“This is a project that wasn’t based on real estate fundamentals,” says Robert Beauregard, professor of urban planning at Columbia. "It wasn’t based on market analysis, supply and demand. It was a politically driven project.”
Lower Manhattan, home to Wall Street, has become more residential. The number of people living in the area has more than doubled since the twin towers came down.
The implication, Beauregard says, is that “it’s going to take a while to lease up the space.”
That's somewhat true. Construction was paused on two of the five World Trade Center buildings because there weren’t enough committed tenants. The centerpiece building, One World Trade Center, is only about half spoken for. So far, just one building is complete and full of renters.
“Fifty, 55 percent committed tenants is about what we expected,” says Michael Shenot, a managing director at real estate firm Jones Lang Lasalle who’s been advising the Port Authority on the development of One World Trade Center.
“It has been a bit of a challenge,” he says, “but more so because of the recession and the financial melt down than tenant concerns.”
He says there’s plenty of time to fill up the rest of One World Trade Center, which doesn’t open for another two years.
Given the hit real estate took in the recession, “we’ve outperformed the rest of the market, especially downtown,” says Jordan Barowitz of the Durst Organization, a commercial real estate firm also working with the Port Authority. He says One World Trade Center is expected to reap $100 million a year in rent once it’s full.
Those tenants will be very different from the original World Trade Center.
“Before 9/11, many of the companies downtown were in the FIRE sector -- finance, insurance, and real estate,” says Dara McQuillan, a spokesman for Silverstein Properties, which is developing the other World Trade Center properties. “Today we’ve seen companies moving downtown are much more creative, technology oriented, nonprofits, you’re seeing ad agencies and marketing firms too.”
One World Trade Center’s anchor tenant is Conde Nast, publisher of Vogue magazine. It will occupy a quarter of the soaring tower.
Barowitz, with Durst, says those kinds of tenants are following their employees.
“Brooklyn and Williamsburg have grown into a mecca for young talented professional people, as has northern New Jersey,” he says, referring several neighborhoods with a reputation for creativity and the arts. The access and proximity to those two burgeoning communities, he says, “has made the trade center a very attractive place to locate your building.”
The increasingly residential character of the neighborhood has affected the design of the new World Trade Center complex. In traditionally commercial areas of New York, austere office blocks serve as glassy 9-to-5 hives of buzzing cubicles during the day and become ghost towns at night.
Barowitz says “design-wise, [the World Trade Center complex] will be very different than the original trade center.” There will be more green space, a performing arts center, a million square feet of retail space. “The site is much more permeable than the old trade center towers,” he says. It’ll be “a lot more accessible and useful.”