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Tenant Talk: Close Up With Corporate Tenants Building Owners Statewide Economy: Reveal latest Priorities of Operational Strategies Upstate vs. Downstate Market Update: Westchester Rents Rise

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Page 1: Hearst Tower Cover Story0001 (1)

Tenant Talk:Close Up With

Corporate Tenants

Building Owners Statewide Economy:Reveal latest Priorities of

Operational Strategies Upstate vs. Downstate

Market Update:WestchesterRents Rise

Page 2: Hearst Tower Cover Story0001 (1)

meal l£ntat_New lork'n

Then...HEARST'S VISION

BEGAN WITH THE $2MINTERNATIONAL

MAGAZINE BUILDING

The Hearst Building is the focusof REAL ESTATE NEW YORK'Sfirst Historical Perspectivesstory, unearthing the pastand revealing the present.

BY BARBARA L. NELSONEditor

The International Magazine Building, as itwas first called, began as an idea of WilliamRandolph Hearst to capitalize on what wasexpected to be a burgeoning extension of thecity's theater district along Eighth Avenue.

As early as 1906, William RandolphHearst "was convinced that Columbus Circlewould become a focus of commercial andtheatrical activity, a successor to Union,Madison, Herald and Times Squares in thetheaters district's march up Broadway,"according to Architecture and UrbanismBetween World Wars by Robert A.M. Stern.

At the time, Carnegie Hall and the ArtsStudents League were already located in thearea and the Metropolitan Opera had recentlyannounced plans to build a new house on 57thStreet that later fell through.

"The International Magazine Building is thecenterpiece of what Hearst had hoped to be agroup of buildings in the area of ColumbusCircle," explains Joseph Bresnan, principal ofBresnan Architects PC and former executivedirector of the New York City LandmarksPreservation Commission. "Hearst felt the the-ater district would move up in that direction."

Hearst bought several properties along theEighth Avenue corridor in anticipation of further

, '\ 28 I Real Estate NEW YORK I March 2006'"

. . (

:. The International Magazine Building circa 1930. It,was The Hearst Corp:s centerpiece for what~ was, e~pected to be an extension of the theater district along Eighth Avenue. , -d

\.

development that never materialized, partlybecause of the success of Rockefeller Center,built in the 1930s.

In 1928, to exemplify what was to be housedinside the International Magazine Building, andto lead the way to the city's latest arts and musi-cal mecca, Hearst selected famed stage design-er Joseph Urban, who had previously designedsets for opera houses and vaudeville shows.

"Urban was a Viennese successionist archi-tect in the modernist movement at the turn ofthe century," says architect Rolf Ohlhausen ofOhlhausen & DuBois, who has studied Urban'swork. "Just before the first world war, he cameto the US. His first jobs here were creatingscenic design for the Boston Opera and subse-quently for the Metropolitan Opera. He also didall of the Ziegfeld Follies stage designs.WilliamRandolph Hearst had him design movie sets.But he was really interested in architecture andwanted to maintain his independence, so hedid not go into a contract with Hearst."

The building, which cost Hearst $2 million tobLJild,was unique in not following any specif-

ic architectural style. According to the RealEstate Record and Guide the building was"meant to convey the fact that it houses indus-tries whose purpose is to exert influence On thethought and education of the reading public."Allegorical sculptures on the building byGerman artist Henry Kreisdenote "Comedy andTragedy," "Music and Arts," "Sports andIndustry" and "Printing and the Sciences."

"He was certainly aware of modern architec-ture, ala the '20s, but it didn't entirely influencehim in the Hearst Building," said Bresnan. "It'snot easy to define it and give it an eclecticname, like neo-c1assic,or neo-gothic. It defiesthat. It's a theatrical modernism. This buildingdeviates too far from the classical to be consid-ered a revival style. I think it's very a much aunique building almost in theater architecture, amore fanciful design like those found in oldmovie housesor vaudeville houses."

UlJfortunately, The Hearst Building is one ofthe few Urban designs that remains standing inNew York City today. Urban also designed

THEN Continued on page 30

Page 3: Hearst Tower Cover Story0001 (1)

~.~...

THE HEARST CORP.CREATES T?H1JJ

ULTIMATE WORKENVIRONMENT

DESIGNED BY LORDNORMAN FOSTER

BY JESSE SERWERAssociate Editor

Seven decades after William RandolphHearst brought all of his magazines under oneroof at 959 Eighth Ave., The Hearst Corp.'sNew York operations had reached the pointwhere they were spread out over 10 differentbuildings. While each office was in close walk-ing distance of Eighth AyenueQnd West 57thStreet, this sprawl proved to be far from iln effi-cient way fel[the world's largestmagazirte pub-lisher to do busil'less in its f1ilgshipcity.

"The company grew and; as (tgrewi 'it greout of space," Brian SchwagerlitJirectdr of realestate and facilities planning"for The HearstCorp., says of the publishers tate 1990s setup."We were growing into other 'poople's spaces,with floorplates that didn't match and standardsthat weren't the same. It bemmes very difficultto plan for your space planning needs. You getno synergies of marketing efforts dnd you havevery difficult facility issues in terms of thingslike mail delivery."

After reviewing their leasing options, lookingat possible spaces in which'to erect a newoffice tower of their own and weighing all their

, options, Hearst ultimately decided on the bold-est possible move-they would finally build theoffice tower atop the magazine building, a?their founder had envisioned back in the19205. "There had been consideration by thecompany's CEOs ever since the original six-story structure had gORe up as. to when theymight expand it into a tower~they had always

NOW Continv[ed on' page 30

Page 4: Hearst Tower Cover Story0001 (1)

THENContinued from page 28 1.

the interior of the New School A~ditoriumon 12th Street and the famed 58~£edroomestate, Mar-A-Lago, in Palm Beach, FL,now owned by Donald Trump.

liThe Hearst Building on 57th Street isnot in the modernist style," explainsOhlhausen. lilt's a kind of art deco style.Urban was never fully accepted by main-stream modern architects in the 20th cen-tury because he did so many differentthings and wasn't an orthodox modernist.Much of his work celebrated here was inscenic design, which translated int0 archi-tecture."

Urban teamed up with George B. Post &Sons on the structural design of the HearstBuilding. The six-story, U-shaped buildingwas built with a foundation of steel thatwould later support an additional sevenstories, but the Depression followed andthe expansion was forgotten unti I afterWW II. But even then Hearst didn't followthrough with George B. Post's plan for anadditional nine stories, with reasonsunknown. Nearly 40 years later, the far,:adeof the building came before the LandmarksPreservation Commission for designation.

Bresnan, who was on the LandmarksPreservation Commission at that time,recalls lithe commission wanted to desig-nate the building for quite some yearsbefore that, but there was owner opposi-tion. The Hearst Corp. did not want it des-ignated and they fought it legally. Theywere very much opposed to it."

It seemed that The Hearst Corp. wasreluctant to have the building designatedbecause it may have prevented furtheralteration to the building. A creative solu-tion was agreed upon and the far,:ade of thebuilding was landmarked on Feb. 16,1988.

"If the commission would acknowledgein the designation report that it was con-ceivable that if an appropriate design wasput forth in the future that the commissionwould consider it, then The Hearst Corp.would not oppose landmark designation,"explains Bresnan. liOn that basis, our staffwrote a landmark designation and it wasreviewed by the owners in advance and itincorporated language that was ultimatelysatisfactory to them. The door was open forthe possibility of building something,which has now been realized so manyyears later."

The building stands today as a reminderof a bygone time, when business mogulslike William Randolph Hearst and John D.Rockefeller Jr. commanded companies thatcould define the commerce as well as theskyline of a city. -RE~Y

NOWContinued from page 29intended to do it," Schwagerl says. "But itwasn't until the late 1990s that we decided itwas time to bring some modernity to the waywe rWrlour bus·inessand build an office spacethat was more functional for our employees,allowing them to be capable of more."

There were much cheaper alternatives ihanbuilding a new tower-let alone one over theoriginal, landmarked structure. But, "in duingour due diligence we reviewed all our leases'and own~rship properties and tried to figure outhow we could unle~sh the best value,"schwagerl explains. "A number of leases werecoming due at the time and the best strategy toachieve the ideal working environment was todevelop in our original home and really unearth

·the potential of 57th ?nd Eighth. It also helpedthat there was a very pro-business environmenthere in New York at that time."

After determining to go ahead in 2000,Hearst brought on Tishman Speyer to partnerwith them in achieving their ambitious proposi-tion.

"Our job was to assemble a team of the high-est quality, from consultants to contractors, and

-to shepherd design and details through the wildworld of New York City high-rise constructiof;1,and produce world-class quality on scheduleand on budget," says Bruce Phillips, managingdirector of design and construction for Tishman

Speyer. "We were responsible for steeringalong the cutting-edge Without toppling overinto the abyss of innovation./I

One of the earliest steps in this process wascommunicating with the New York CityLandmarks Preservation Commission, whichhad designated the original six-story structure as·a landmark in 1988.

"Jennifer Raab, the then-chair of theCommission, advised that in order to gain per-mission to build a tower over an individually-designated landmark Hearst would need to'knock our socks off' in the selection of thearchitect and in the tower's design," Phillipssays.

Hearst, Tishman and, ultimately the City,found whatthey were looking for in Foster andPartners, the firm of renowned British architect,Lord Norman Foster, whose recent projectsinclude tile New Parliament at the Reichstag inGermany and the New Globe Theater inLondon. Not only was Foster experienced inupdating historical structures for the present butthey also came with a track record as innmla-tors in the green-building movement. But, whilethe architect has since been retained by LarrySilverstein to design 200 Greenwich St.-Tower TW0 at the World Trade Center site-this was its first project in New York and its firstmajor work in the lJS.

''The initial question was what do you dowith the mass of the existing building?" explains

Page 5: Hearst Tower Cover Story0001 (1)

Mch@enWurze[, pWjectarclilitecffor Foster andlilacltners.1'Also,the floo~J)eigl'l'twas 11 feet'-'-tbat's riot considered adeqI,Jatefo[' moilleril

',office space.'1 Foster d~cided·to open upthe,six~floor strlclcfureintoa four-story base, with 42additional stories rising from its center. 'Wewanted to establish a visual connectionbetween thi; exteriOf,and the inteniofilndmaRia, sem i-outdoor space.", 1"he ardlitectsarrived at a 46~st0fY tal1,.856,OOO-sfStruotllre simultaneously preservingh~dassic, theatrical feel of Hearstal'idUrbap's

"OFigir;]al'structur~,whil~"estabnisRir;]ga,new stan"eardforcuttiflg-eillge techl'lologyandarchltec-ture,in New yorkQity.lpe building:s definingfeatures'wpllid .beafram@ built on a pattern ofdiagonal, tfiangwJar, follr-story tail cotumns,wbichFoster ahd ~is architec;tscall lithe dia-grid", its eff,~(;tmore closely reserrlbling a·giantLava Lamp'm0re than a skyscraper. Already

"thjnkingoutside the boX' architecturally, tRe.bLlilderssawa unique oppoJ'tunityto go.com-pl@i-ely"green". '

"We studied §orporateneadquarters ~frol'l1aroumd the. world and tried to pick oLlHhe best/of-.thlebest afl@whakmadethem that way/'Schwagerl says. ('A 'green building t1ad neverbeen built in.NewYorkC;;ity but thetechmologyexisted. Ifwe weregoingw i,wesf all our time,money and effort f(i)ra corporate headqwarters,thethought was 'Why not build th~best?' and,that includecfbri ngirrgleadingenyiwnmentaland oesignpracticesto tnetaole:Y

As part 6fildea'1 struck between" liearstandthe city allowing themJ9add~ixad(;jitional 5.1'0·ries 1'6thebElilding, the €ompa6ywas inclined

ill1PrQvethe C:01umbusc:irde swbway sta-t4on, sitwated, immediately below. Fosterdesigned tlhe layeut ofthe new subwaystatien,and Hearst insfalleaanew~ehtral'1ce,tl'1reeele:vators and new ~tairWell's{ ,

"It took niri'elliJonthslJirtil the tower's designwasaf?proved/5<;~w1,lger!sa¥s.lI~y virttJe.ofneeding government approvah we had enougl:1time to do pr0Jperplanning.'6y studying how;~you use space, whieh W6J.,did early on, youeould come up witH a maximum iloQrspaceth~t eQuid have betterusageforus.We.coulddesign~paces fhat would accommodate huge~a5hiondosets and allow for armoires., All of{hesethings lead to a'more ,efficient workplace/'

6ut just astne final designs we"eabeut to beE1nveil6J.d,tile unthinkabJleevenfsof 9/11occurred.

"We were~to make a major ~resentation to£he.beard on September 11/ Wurzel recalls .."Normal'1Qaclflowhin 6nSeptei:il15er 10. Rerewe wereproposil1g a new tower'f0rNewYorkGmth12 same day as the two biggest were COIliJ-ing down."

Like. the rest of£he-country, the impact ef9/1~ led to confusion and much deep thinkingfmtlire Hearst lower team. '

''It.made 4S ~tep back ante!say 'Should we be,builditlg atower?'ls what we hlavesafeenowgh?'and, lastly; 'What does it allrmean'?II'Schwager! S1,lys."One immediate, reaction wehad was we won't be able to get steel. But itended up being compl6J.telytlheofJlposite.OtAerconstruction projects slowed dowh to a haltandprojects gor pulled0f{--th6J. drawing board.,Materialbe9me more readily available.", BeCidingtq m(')\le gefQre 20(;)1 cam6J.to aclose} Hearst became the first entity toproposea new offic€'tower fm Manhattan post--9/l'l., "

" "Bypute luckwe got steel before the Chinacrisis/Schwagerl says. "We were. ableto~etthe.A~team of builders' and have verygQod

f;

priGesat the. same tirno/3ht1.L4, wil.5createcl in','tneCQl'1strw;:tiOnand real estate"developmeMt"world, and weattraEt6J.@ tne',oestpeoplB': -It~{~"becam~ tbe 'it project' iR New Vork C:ityandmade an already safebuildil'1g safef.ltprov€dtobe a DGld,decisionfor tJ,ewYork b,utasafe,deci"siantor us."

TlleC:antOr Seinl'ikCmup wasJapf?6J.da~:structural engineersfar the pr.oject; "with FlaCKancl Kurtz:Ino. coming'orias rnecha~rGafengicnee[sand Turner Constiuctiorl(:orp.,as cgn"struction manager. . , . " ' "

III flew awtto Bedonia, ltalyang handpic:ked;;;'-;0the stoPlefrom a quarry;" Schwag~rrsays.

ti;]e new'tow~f began emergl1'l~ onthe~

Page 6: Hearst Tower Cover Story0001 (1)

western fringes ef the city's skyline, joining theRewly opened Time: ~arner Center jLJsttwoblocks away, it started becoming apparent to allthat a different sort ot bwilding was rising atEighth and 57th.

''You get a 'wow' feeling lmlking up from thestreet, you get a 'wow' feeling when you comein the building, you get a 'wow' feeling whenyou arrive at your floor/' Schwagerl says.

The building's unique design also allowedfor the use of 20% less steel-nearly 2,000tons-than in a similarly sized building. Assuch, it has no vertical wlumns, creating other-wise impossible corner views.

When it opens later this year, it is expectedthat the Hearst Tower will 00 the first officetower in New York City to receive a gold ratingfrom the US Green Building (ouncil's LEEDcertifi(;atiQnW0!:trqll'l,;,.(SIDlaire, a residentialtewer in Battery Park.iSityf:is the only bClildiRgto have reCE~ivedWidesignation thus far.)

A pair of 14,OOO-galion reclamation tankswill collect rainwater which will be used topower the building's air conditioning systemand to water interior and exterior greenery,while reducing runoff by 25%. That water willalso find its way into "Ice Falls," a three-sterycascading waterfall that will greet staff and Visi-tors as they take an escalator from the groundlevel to the building's raised lobby on the thirdfloor.

"The waterfall adds to the humidity in thewinter and chills to a comfortable temperature

in summer/, says Foster architect Peter Han."The tri<::klingdown sound createswhite noise."

The building will have the cleanest air of anyoffice building in New York City, saysSchwagerl, who figures the green features willsave the company $50,000 a year in energybills and $12,000 in water savings. It has alsomade Hearst eligible for $5 million in tax cred-its from the state's energy program.

''We started out slowly learning the processand incrementally started buying correctly andchallenging our subcontractors to think in agreen frame of mind/, Schwagerl explains. "Itbecame easier to achieve our goal of an envi-ronmentally-friendly building because every'-one was leoking in that direction. When westarted, people told us it couldn't be don~it'stoo·na,rcJor expensive to do in New York City.We jl1sj;~chall~nged that thought [:lrocess.Welooke'dat buildings irl Europe and Californiaandsaid'ifthey could do it, we should be ableto do it here in New York.'"

The Hearst team make a point to em[:lhasizethat the green aspects of the tower extend toevery nook and cranny of the building: whilethe tower was designed to include as few inter-nal walls as possible in order to maximize nat-ural light the walls it does have are coated withlow vapor paints. Concrete surfaces were fur-nished with low toxicity sealants, the floorswere manufactured with recycled content, andall office furniture will be formaldehyde-free.Even the cafeteria is an extension of this philos-

opby, serving organic greens and health-con-scious foods.

"Foster is an interior architect aswell, so a lotof detail went into the interior office," explainsScnwagerl. "They took the inside of the oldspace and made it a part of this new spaceinstead of replacing it. I can look and say that'swhere myoid office was."

The raised lobby is home to the cafeteria aswell as a theater that will host screenings forHearst staff and invited guests and host meet-ings of Man~attan's Community Board 4. Fromthere visitors will take elevators, made by theFrance-based Schindler Co., which promise tobe the fastest in the city.

Another innovative aspect of the buildingwas Foster'sapproach to light.

"Enhanced lighting is important for peoplewho are laying owt magazines," HaD points out.~he glass has a special 'Iow-E' coating thatallows the internal flooding of natural lightwhile keeping out the invisible solar radiationthat causes heat. "We wanted to have the clear-est glasspossible without compromising perfor-mance-we searched throughout the worldand found it in Luxembourg." In the lobby, thesun moves across the room throughout the day,transforming its appearance. Upstairs in theoffices, motion sensors allow for lights andcomputers to be turned off when a room isempty.

Another unique facet of the building was thelevel of input the architects sought from thebuilding's primarily female occupants, includ-ing the creative and editorial ,taff of magazineslike Good Housekeeping, 0 and Seventeen.

"That there is such a female population atHearst drove a lot of the discussion on interiordesign and influenced the materials palate/'Wurzel explains. "The fabric wa,designed witha fashion desigliler in Italy. You rarely have 80%female employees like here, so it presents aunique opportunity."

Low office cubicles were created to enhancethe visual connection among workers. "Eventhe lips on the desks are made in such a waythat they won't scratch th€mselves," Schwagerlpoints out. "There is a place underneath thedesk for their shoes. The design team for thebuilding custom-designed the furniture."

Featureswere tested at Hearst's Los Angelesoffices, where women remarked with com-ments like "I can't believe you put a mirror atthe right height", according to Wurzel. "Theone thing we missed out on is the hook in thecubicle is not long enough to have a handbagwith a wide strap."

The attention to detail went right down to thebathrooms, which the architects claim are onpar with what you'd find at the Four SeasonsHotel.

"Hearst didn't /want prillate bathrooms forexecutives," Wurzel says. "They said 'We'd

NOW Conti('lU~d on page 47

Page 7: Hearst Tower Cover Story0001 (1)

NOWContinued from page 32rather upgrade all the toilets and bathroomstogether to the highest quality, throughoutthe building.fII

Individual floors are being custom-designed around the particular magazinesthey will be serving.

"The backdrop is a coot gray backgroundby which the brands will be able to imposetheir own branding opportunities," Hansays. As such, Cosmo will look completelydifferent than Seventeen-who incidentallywill occupy the seventeenth floor. "Wewanted the floors to have a very open, airy,light atmosphere to boost creativity. Thefashion industry operates differently thanother industries. The editors and publishershave this sort of star status. To attract thebest talent, they have to have the best envi-ronment, so we had to create a theatricalsystem. One of the key features for the officefloors is a blinds system based on sailboats.The mechanisms are hidden cleverly andintegrated into the system."

Pat Haegele, senior vice president ofGood Housekeeping Inc. and publisher ofGood Housekeeping Magazine, explainsher and her colleagues' role in designingtheir respective floors.

"It was a of collaboration for the betterpart of a year," Haegele says. "We had face-to-face meetings with a consultant and heasked us to do a brief on what our needswere. And he used it as the platform to buildthe structure and design then came backand showed some of the design movement.The Good Housekeeping Institute is on the28th floor-we purposely put it on the breakfloor where the first elevator bank ends andthe second begins because we wanted to beopen for tours. The magazine offices werealso designed with the outside coming in, sowe are keeping it open and spacious-a sortof 'paperless office' atmosphere."

With the Time Warner Center just twoblocks away, it seems that WilliamRandolph Hearst's vision of ColumbusCircle as the cultural center of New YorkCity may have finally materialized.

The tower also has a variety of meaningsfor the building community, says Richard T.Anderson, president of the ew YorkBuilding Congress. "It went ahead in a verycritical time for the industry but, secondly, itis an iconic structure that commands atten-tion from many different vantage points inmidtown Manhattan. Finally, it demon-strates how a modern structure can be effec-tively integrated with a landmark building. Itreally is a unique building. How it was doneis a credit to everyone involved, from TheHearst Corp. to the contractors. It really hadthe best our industry has to offer." ~RENY

Adams & Company, 15

Castle Oil, 9

Con Edison, 1

Exchange Solutions, 16

Fremont Investment & Loan, 5

GGMC Parking, 14

GlobeSt.com, 36

Hyline Safety Company, 12

Imperial Capital Bank, 7

linColn Center, 43

Massey Knakal, 21

Murray Hill Properties, 3

New York University, 13

Quality Building Services, Cover IV

RealShare National Investor, 33

RealShare Net Lease, 18

RealShare TIC, 16

Realty Foundation of New York, 39

Related Properties Corp., 12

Schulte Roth & Zabel, 6

Select Leaders, Cover III

Time Warner Cable, Cover II

This advertising index is provided as an addi-tional service. While every attempt has beenmade to make this index as complete as pos-sible, the accuracy of all listings cannot beguaranteed.