7 Times Square Tower
2023
Manhattan, NY 110,000 sf
Services
Owner Representation
Construction Management
Client: BXP (formerly Boston Properties)
Architect: MKDA
General Contractor: StructureTone
The Intersection of Federal and Private Sector Real Estate
After a highly competitive Federal lease procurement process, BXP secured a coveted, long-term 110,000 sf Class A Office lease in a market that saw a 12% increase in midtown office vacancy rates since the pandemic. The larger challenge now lay in the design, entitlements, construction, and turnover to asset management of this trophy asset, within the nuanced context of strict compliance with unique Federal lease obligations.
The Challenge
Unraveling the Intricacies of Real Estate Development
Leases are complex, even more so, leases for spaces that house agencies that support a United States Federal Government. From execution, to design, through construction and space acceptance, Government Services Administration (GSA) leases contain subtle differences as compared to private sector leases that determine the success of a project delivery and asset performance.
As a trophy asset within BXP’s 13M sf portfolio, an on-time rent commencement was critical to portfolio performance. Similarly, the timing of availability of funds to finance the agency’s costs above the improvement allowances.
The Solution
What does Success Look Like to You?
Beyond the rudimentary “on time and within budget” response, the team remained aware of the internal objectives of both Owner and Tenant. Through consistent benchmarking, scheduling, and budget forecasting exercises, efficiencies were yielded through a highly detailed probing of the process that guided the strategy of both Owner and Tenant, and ultimately, the project.
The Owner relied heavily on the team’s unique depth of knowledge and experience in delivery of this niche asset type. As a result, creative financing and funding strategies were implemented to maximise return on investment.
As the Tenant’s scope quickly expanded to align with further future proofing their business objectives, the Tenant’s space management and facilities team conducted frequent collaborative sessions with the team, displaying extraordinary transparency, which fostered an environment of trust, and cohesion. As a result, a phased delivery of certain Owner capital improvements was executed to produce the most cost effective and expeditious delivery and implementation of Owner and Tenant building systems.
The Result
Collaborative Success Delivers Value
Thorough and transparent coordination produced improved funding efficiencies and a reduction of the anticipated project schedule, resulting in a realisation of $3.5M USD in value. With occupancy, business operations, and rent commencement achieved ahead of schedule, this successful project laid the foundation for a mutually beneficial, enduring relationship between Owner and Tenant.