Business of Law
Law Firms Shop for Deep Office Space Discounts, Possible Shark Tank, in Buyer’s Market
Posted May 10, 2010 4:46 PM CST
By Martha Neil
Two well-known law firms are reportedly shopping for bargain office space in a buyer's market:
In New York City, Proskauer Rose is expected to ink a deal this week for about 40 percent of an office tower being developed at 42nd Street and Eighth Avenue, reports the New York Times. Sweeteners include the display of the Proskauer name on the building exterior and what amounts to a subsidy of tens of millions from Morgan Stanley, the law firm's current landlord, to vacate Proskauer's present 12 floors of office space in the bank's world headquarters at 1585 Broadway.
Proskauer also will reportedly pay about $75 a square foot for its new offices, some 30 percent less than the developer had hoped to get in 2008.
In Maine, the state's biggest law firm, Pierce Atwood, is seeking a tax break of nearly $3 million on behalf of the owner of a needs-work waterfront Portland building as it looks to move in 2011 from its offices of some 30 years, reports the Press Herald.
Although the firm wouldn't benefit directly from the tax break, it would benefit indirectly from more favorable, unspecified lease terms, according to the article.
Not to be outdone, Thacker Martinsek recently subleased 4,320 square feet of excess office space from the Cleveland-Cuyahoga County Port Authority at a bargain price in Ohio, reports the Plain Dealer.
For the first six months of the four-year deal, the law firm pays the government nothing, the newspaper says. Thereafter, it gets the offices at $12 a square foot--a $9 discount from the rate the port authority pays. The law firm's rent goes up another 25 cents per square foot each of the next three years, as the port authority's rent goes up 50 cents per square foot.
A shark tank is reportedly on the drawing board for the public area of the planned Proskauer office building and it appears that one could be featured in Pierce Atwood's new space, too, which is zoned for marine use.