Anonymous Co. seeks Westchester space

Real Estate Weekly, March 2, 1994 by Lois Weiss

Westchester is buzzing with the news that a large financial services company is looking for up to half a million square feet of space. The name is being closely guarded by its agent at COMPASS Management and Leasing Inc., William Korchak, who is representing the organization in its search.

What makes Westchester County, New York, attractive to a company?

Korchak, director of leasing for COMPASS, would only talk in generalities. "Westchester is a more logical move for them than Long Island or New Jersey," he said. But the company is also looking at North Carolina, The Westchester County Business Journal, which broke the story, reports.

While Westchester's labor market is tight, many of the people who are available are high-powered managers who were laid off by NYNEX, AT&T and IBM, and that is also attractive to this company, Korehak noted.

"Westchester has attractive large blocks of space and gives a tenant the ability to benefit from corporate down-sizing," he said. "There are opportunities out there where the price to purchase a property is attractive and dramatically below replacement cost. It becomes a matter of the corporation and whether it makes sense."

Korchak explained that privately owned firms like the stability of owning their own building, while public corporations usually rent space.

The company has looked at a leasing opportunity at One North Lexington in downtown White Plains and is exploring the purchase of an IBM campus property constructed as a headquarters site.

The leasing agent for the Lexington Avenue property, where 347,000 square feet will become available at the end of the year as AT&T pulls out, said in many cases, there is a much better quality of life in Westchester than in New York City. "Commuting is shorter and the county has a more manageable pace. Costs are generally less and the buildings are friendlier," said Howard Greenberg, vice president for Austin Corporate Properties.

At 520,000 square feet, the black glass structure, also known as Gateway 1, is about the single largest office building in White Plains and is directly across from the Metro North station.

"It's a big black glass box with notched sides so you get ten corner offices per floor," noted Greenberg. With floors of 32,500 square feet, Greenberg said it would be very efficient for tenants that are large work station users. There is also another 30,000 square feet for basement storage.

Last week, the White Plains Common Council voted to allow the building's manager, Jon Halpern, and owner CIGNA Insurance, to landscape its vacant land and parking garage across the street and design a connecting covered walkway for the Gateway tenants and visitors. The landscaping is being planned by M. Paul Friedberg, who designed part of the Battery Park grounds.

"In anticipation of releasing this building, we have had an entire lobby redone by Der Scutt, who designed for the Revlon building and Trump Tower, H added Greenberg.

Halpern said they have spent about $1 million on the lobby and expect to spend another $2 million on the walkways and landscaping.

With 24-hour, seven day security and a full, interior loading dock that accommodates 18-wheeler deliveries, it would make a great home for any corporation.

The IBM building is a headquarters-- type quality building situated on 47 acres of parking, with both landscaped and open area. While not in downtown, it is a short drive. It is, however, on somewhat of a triangle between the Hutchinson River Parkway and 1-684, and ideal for suburban commuters who are more likely to drive to work. Designed by I.M. Pei, Michael Siegel, executive managing director of the Edward S. Gordon Company in Westchester, said the building has beautiful atriums, meeting rooms, conference rooms, auditoriums and a cafeteria. "It's all functional space," he said.

As for pricing on the complex, which he said is not for rent, Siegel said they are conducting an appraisal and market analysis now in order to set a price.

"Rents in New York City are starting to be pushed up as a function of the available space," he said, making Westchester an attractive alternative.

While its possible that the firm seeking. space is just using the possibility of a move to seek better benefits from New York City, the company may not be from the city, at all.

Catie Marshall, a spokesperson from the New York City's Economic Development Corp., would not say if they were working with such a company.

The County's Director of Commerce and Economic Development, Margaret Soter, said they were very excited about working with the company and most concerned they would be identified and decide not to move to Westchester.

"If we find a company that wants to go to White Plains we will work with them," she said.

The Regional Director of the Mid-Hudson Region of the New York State Dept. of Economic Development, Kathleen Sullivan said, "In our work with companies, we have found that the things that attract corporate headquarters and office users into Westchester county are rental rates, property taxes and utility rates.