"One Court Square's attractive price per square foot offers the potential for material asset value appreciation as the surrounding market continues to develop," says Scott Rechler, Reckson's president and chief executive officer. "It is our intention to capitalize on this acquisition to pursue additional value-added opportunities in the Long Island City submarket." Tod Waterman, executive vice president and managing director of Reckson's New York City division, says the acquisition complements its 90-property, 17.7-million-sf portfolio.

Citibank plans to develop a 475,000-sf, $200-million office expansion adjacent to One Court Square. Reckson officials believe the Long Island City submarket will benefit from the strength of Midtown Manhattan's class A office market, the continuing trend of regional decentralization in the New York Tri-State area and the significant infrastructure and zoning upgrades planned for the area.

In 2001, the New York City Department of City Planning identified central Long Island City as a growth area with significant potential for office, retail and residential development and the city council adopted the initiative to rezone 37 centrally located blocks in the area. The zoning was expected to facilitate commercial development at increased densities as well as allow new residences to mix with commercial and light industrial businesses.