Publisher Conde Nast signs $2B WTC tower lease

AP News
Posted: May 25, 2011 4:59 PM
Publisher Conde Nast signs $2B WTC tower lease

Magazine publisher Conde Nast formalized an agreement Wednesday to relocate its global headquarters to 1 World Trade Center, a move that will add a touch of glamour and a prized anchor tenant to the landmark tower rising at the site of the Sept. 11 attacks.

Standing on the 34th floor of the unfinished spire, with a view overlooking New York Harbor and the Statue of Liberty, officials from the company and the Port Authority of New York and New Jersey signed a $1.9 billion, 25-year lease that calls for the publisher to take over about a third of the skyscraper formerly known as the Freedom Tower.

Conde Nast, the publisher of Vogue, Vanity Fair and The New Yorker, among other magazines, said it would move more than 3,000 workers into about 1 million square feet of the tower, on 21 floors. It becomes the second corporate tenant to ink a deal for space, and its presence is almost sure to inspire more buzz than the first entity to sign on, a Chinese real estate investment firm.

"From travel to fashion to cultural critiques, the Conde Nast imprint lends authority to any subject. The same can be said with real estate," the Port Authority's executive director, Christopher Ward, said at a board meeting earlier Wednesday where the agency approved the deal.

Mayor Michael Bloomberg said at the lease-signing that the publisher's presence in the building will be a trendsetter downtown, much as the company was when it moved to its current Times Square headquarters in 1999. Conde Nast's embrace of the once-seedy district helped establish it as a proper corporate address. Bloomberg said he expected the same phenomenon downtown.

"They have blazed a trail. Others will follow," he said.

Conde Nast chairman S. I. Newhouse Jr. said the company has thrived off of the city's "indefatigable energy, power and vitality," and was proud to be part of lower Manhattan's rebirth.

One World Trade is slated for completion in late 2013. At 1,776 feet, it will be the tallest building in the U.S., and the centerpiece of a redeveloped ground zero.

The steel frame of the tower now reaches 66 stories of a planned 104 designed to punctuate the rebuilt site of the World Trade Center, which was destroyed in the Sept. 11, 2001, terrorist attacks.

About 1.8 million square feet of office space in the building are still available for rent. The deal calls for Conde Nast to take possession of its space in the building in 2014.

The skyscraper is one of several envisioned at the site, along with a Sept. 11 memorial, transit hub and performing arts center.

Port Authority board members also approved a partnership deal Wednesday that will allow one of the city's biggest names in real estate, the Durst Organization, to make a $100 million investment in 1 World Trade Center and take over leasing and property management for the property.

Julie Menin, chairwoman of the community board that covers the World Trade Center site, said she expected Conde Nast's arrival to spark growth in restaurants, retail and amenities.

"This is great news for downtown and hopefully will be a harbinger of many other leases to come," she said.

The search for an anchor tenant from the private sector had lasted years, through complex and sometimes contentious dealings with multiple stakeholders.

"There were a lot of bumps along the way, but this will be an incredible testament to the citizens of our city, of how we have rebuilt," said William C. Rudin, chairman of the civic group Association for a Better New York.

Conde Nast's move from midtown Manhattan to lower Manhattan was a natural progression, Rudin said. Cost-conscious publishers who weathered an industrywide downturn as advertising rates plummeted and viewers migrated online were eager to get better deals for their money, he said, and lower Manhattan frequently offers more space at a variety of price points.