Time Warner Move Could Create Glut of Office Space in E. Midtown, Pol Says
MIDTOWN — This borough ain't big enough for the both of them.
It was reported last week that the media megacompany plans to move from its glass-encased 80-story tower at Columbus Circle to a planned 80-story skyscraper on the Hudson River waterfront. And while the move marks a major win for Hudson Yards developer The Related Companies, Councilman Dan Garodnick and others have raised some concerns.
"It is a big marquee tenant, and in the New York commercial real estate market, there's only so many of those," Garodnick said in an interview with DNAinfo New York.
Time Warner's reported new office — combined with the vacancy the move would create at Columbus Circle, and the new skyscrapers being planned for East Midtown — could create a glut of office space, he said.
The developments in East Midtown would come about under the rezoning proposal introduced by the Department of City Planning in April. The proposal, fast-tracked by Mayor Michael Bloomberg, aims to overhaul 73 blocks around Grand Central Terminal to allow developers to build newer and bigger buildings.
Now winding its way through the city's Uniform Land Use Review Procedure, the proposal includes a "sunrise provision" that, if the plan is approved, would bar developers from constructing any new buildings for five years — essentially to avoid a sudden influx of vacant office space from developments in both Hudson Yards and East Midtown, as well as the Financial District.
"Ostensibly the purpose of that five-year sunrise provision is to protect commercial developments in other parts of the city from competition from East Midtown," Garodnick explained.
Nevertheless, even before Time Warner's plans to move to the West Side were revealed, local community leaders argued that the sunrise provision should set a far longer blackout period — one pegged to certain benchmarks as opposed to an "arbitrary date" to ensure development in East Midtown occurs only when there is demand for commercial office space.
"The sunrise provision should be tied to development goals being met in Lower Manhattan and Hudson Yards and to key infrastructure milestones such as the completion of necessary improvements to the 4/5/6/7 [subway lines] and E/M [subway] stations the MTA has identified," read a June 17 report from a "Multi-Board Task Force," comprised of community boards 1, 4, 5, 6, rejecting the city's rezoning proposal.
Douglas Elliman realtor Martin Robert Holland, whose specialties include commercial real state, offered a similar view. "I would definitely say they need a longer horizon," he said, adding that Time Warner's reported move made extending the timeline only more urgent.
"It's a bellweather," he said. "It's a marquee name, it's a huge presence, and the fact of them going over there [to Hudson Yards], it's momentum. East Midtown would need more time."
Garodnick, meanwhile, avoided taking a firm stance on extending the sunrise provision. But in the wake of the reported Time Warner announcement, he allowed that "whether it should be shorter, longer, or not at all, it is a question I am still struggling with."
Time Warner has declined to comment on its planned move. The Department of City Planning did not return calls.