Study: WTC Towers Could Garner Top Rents

NEW YORK CITY-Citing the inherent competitive advantages of new office space and forthcoming improvements to Downtown, a study from CB Richard Ellis says Towers 2 and 4 at the World Trade Center will command high rents when completed in the next four to six years. The study was provided to GlobeSt.com by Silverstein Properties Inc., which is developing both towers and also plans a third one at Ground Zero.

“Buildings of high quality in optimal locations benefit more from booms, and suffer less from declines,” the report states. “The 25 buildings that commanded the highest rents in 1998 out-performed the rest of Midtown in both up and down markets. The premium is currently 85%. These buildings boast either iconic architecture, new construction or highly efficient space, all of which will be available at WTC.”

They’ll also have the benefit of opening after Manhattan’s vacancy rate starts to decline from its projected peak in the first quarter of 2011, according to the report. Based on estimates of office-based employment by Moody’s Economy.com, CBRE forecasts the market’s vacancy rate peaking at 14.3% with a 50% sublease ratio or 17.4% with a 70% sublease ratio. Either way, it will be on a downward trend by the time Tower 4 opens in 2013 and Tower 2 opens in 2015.