Prudential Designs On Downtown Are `Very Preliminary'
March 23, 2006
By JEFFREY B. COHEN, KENNETH R. GOSSELIN And CHRISTOPHER KEATING, Courant Staff Writers
Prudential Retirement, which already
employs nearly 800 people in downtown Hartford, is talking with
state officials about a deal that could lead to the construction
of an office building in the city and the addition of an unspecified
number of new jobs.
While officials declined to comment
publicly on the talks, high-level sources in state government and
others familiar with the negotiations confirmed that talks are underway,
and said the critical issue is the level of funding state economic
development officials are willing to provide.
One high-level government official
cautioned Wednesday, however, that the talks are "very, very
Officials declined to say whether a
potential site in Hartford for a new facility has been identified.
It was also not clear Wednesday if sites outside the city might
be under consideration.
The retention of financial services
jobs is a critical issue for Hartford. With the impending loss of
the ING Group and its roughly 2,000 jobs to Windsor, protecting
the financial services industry has been a high priority for Mayor
Eddie A. Perez.
Last November, at a jobs summit with
corporate leaders, Perez, who was not available for comment on this
story, referred to the "urgency" of keeping and creating
Prudential officials also declined
to comment on the talks, but they did say in a statement that while
they remain "committed to operating in the Hartford area,"
they also have a "responsibility to consider, review and evaluate
thoughtfully all available location options, including its current
Prudential Retirement, a unit of Newark-based
Prudential Financial Inc., has 790 employees at 280 Trumbull St.
in downtown Hartford, where it leases more than 230,000 square feet
- roughly a third of the 28-story tower. The lease expires Dec.
Prudential bought the retirement side
of the Hartford-based CIGNA operation in 2004, and Hartford has
since become the headquarters of Prudential Retirement.
If the company does build, it would
be the first office construction in downtown Hartford since late
1989 when Goodwin Square and CityPlace II opened. Since the real
estate collapse of the early 1990s, vacancies have remained too
high in the city's central business district - and rents too low
- to justify the cost of building a speculative office tower. The
current construction boom in the city is largely residential.
Prudential breaking ground for itself,
however, would differ from speculative building. Risks - and borrowing
costs - are typically lower for companies that build for themselves.
Although the city has been pushing
the site known as "12B," at Main and Trumbull streets,
as a prime location for office development, there are at least a
half-dozen possible sites sprinkled throughout downtown, commercial
Included among them are the sites where
office towers were proposed but never built in the late 1980s: 180
Allyn St., once seen as the site for a building with more than 1
million square feet; Metro Center, where only one tower and a parking
garage were built; and the site of the old Parkview Hilton, imploded
There also is the site of the Renaissance
Place, the hotel-office development, on Main Street between Pratt
and Asylum streets.
Prudential also has the option of staying
put at its current location, according to Michael Grunberg, a principal
in the firm that owns the 280 Trumbull tower. Grunberg said he has
been in lease renewal negotiations with Prudential for at least
six months for a "longer term" lease that would run at
least 10 years.
"I expected by now for them to
say yes, no or we're out of here," Grunberg said.
While the tower's occupancy is high
at 92.5 percent, Grunberg said he could offer Prudential another
200,000 square feet in addition to the space it now occupies by
the time Prudential's lease expires at the end of next year.
"There would be plenty of room
for them to expand," Grunberg said.
Grunberg said he has offered Prudential
attractive "below-market" lease rates, but declined to
disclose specifics. The average asking rent for prime space in the
city's central business district was $23.29 a square foot at the
end of 2005, according to commercial broker Cushman & Wakefield
Jones Lang LaSalle, Prudential's local
broker, declined comment Wednesday.
Courant Staff Writer Diane Levick contributed
to this story.
Reprinted with permission of the Hartford Courant.
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