Added Costs of Enhanced Security Part of Future Lease Negotiations

NEW YORK CITY-Eight AM real estate conferences at the Waldorf-Astoria didn’t use to require photo IDs for entry. That was pre-Sept. 11 and things have changed.

More than 250 professionals in attendance today at a GVA Williams-sponsored conference on “Security and the Effects of Terrorism on Real Estate and the Workplace” felt first-hand the new realities in public security that building owners must adapt in this post-terrorism climate.

From a real estate perspective, the primary issue will be who pays for the added expense of more secure buildings. “How to apportion the increased operating costs between landlord and tenant will be a factor of market dynamics, of who has more leverage in negotiations,” said Robert L. Freedman of GVA Williams, which sponsored this morning’s event. “Security will also become a human resources issue since the more sophisticated companies will balk at relocating to buildings they consider less secure.” Freedman said that building owners and tenants must wage a “war of vigilance in the nation’s workplace” without unduly compromising personal freedoms.