Mort Zuckerman’s Boston Properties yesterday said it is putting off building a $980 million office tower in Midtown after a law firm backed out of its plans to lease a huge chunk of the skyscraper.
While Boston Properties did not name the law firm when it issued a statement announcing the 1 million-square-foot tower’s construction was on hold, law firm Proskauer Rose is widely believed to be the firm bailing on the project.
The firm was said to have come to financial terms on a lease last year, but rumors have been rampant that Proskauer was trying to get out of the deal, which involved leasing more than 400,000 square feet of the planned tower at 250 W. 55th St.
“Recently the law firm informed the company that it could not proceed on those terms thereby rendering the project economically infeasible in today’s environment,” Boston Properties said in a statement.
Yesterday’s news confirms a report in The Post last month about problems with the deal that had the potential of derailing the project.
Another law firm, Gibson Dunn & Crutcher, agreed to lease about 215,000 square feet in the planned tower, but that isn’t seen as being enough to justify pressing ahead with the project.
During its conference call last week, Boston Properties executives said they were negotiating with some tenants and were “cautiously optimistic” about concluding deals.
Boston Properties is now reviewing its costs and the charges for mothballing the project, which is already underway. The foundations will be completed, it said, “to facilitate a restart of construction when it deems it propitious to do so.”
Yesterday’s news comes a week after Boston Properties said it was canceling plans to build a Times Square-area tower with the Related Cos.
