The Pentagon has leased some fancy new digs on the 28th floor of a New York City skyscraper for $43.25 a square foot, angering a New York congressmen who rents his office space for $11 a square foot.
The resultant publicity raises the possibility that the tenant, which the Pentagon will not disclose for national security reasons, might never move into the $259,500-a-year offices in the Crystal Pavilion building at 3rd Avenue and 50th Street.
The 32-story building, partly opened about a year ago, affords a spectacular view of the East River and, incidentally, is six blocks from the United Nations.
It was the need for secrecy that led the Defense Department to negotiate the 10-year lease, a task that is normally performed by the General Services Administration. The Pentagon acted on behalf of another agency, which is reimbursing it.
But Rep. Bill Green (R-N.Y.), who learned about the lease from a newspaper report, wanted to know why the hush-hush activity could not be conducted in a lower-rent area. "There's all this talk about skyrocketing budgets, and the Defense Department goes out and rents space at $43 a square foot," said Green's press aide. "It just doesn't make sense."
According to the GSA, going rates for federal office space in Manhattan are in the $26-$45 range. Rates for "unserviced" space, meaning tenants have to arrange their cleaning service, are at the low end of that scale. The Pentagon was not releasing any details on the lease, but it would seem that such a secret tenant would want its people emptying the trash baskets.
GSA officials have said in the past that their most expensive office space is in San Francisco, at about $35 a square foot. The Pentagon said the space was for a new "joint liaison unit" that needed the location "to conduct extensive classified negotiations with various government agencies and the private sector, to include U.S. and foreign industries, many of them headquartered in the vicinity." That seemed to indicate that some in the private sector would know who the tenants were but the public would be kept in the dark.
Meanwhile, Sherman Cohen of Cohen Brothers Realty and Construction Corp., the building's owners, says he does not know who the tenant is, but the lease affects less than 1 percent of his building's 600,000 square feet of office space. "Doesn't the government have better things to worry about?" he asked.
As for Green, who rents his $11-a-square-foot space in the Grand Central Post Office, Cohen said, "That building's scheduled to be torn down. He'll never get a lease at that rate again."