Phillips Lytle, a prominent fixture of Buffalo’s Inner Harbor, will be moving its offices next month a short distance to One Canalside, formerly known as the Donovan State Office Building, at 125 Main St.
The law firm, one of the largest in the city, will be leaving One HSBC Center, where it has been a tenant since the building’s opening as One Marine Midland Center in 1972.
Phillips Lytle wanted to “explore alternatives” and “spent two years evaluating its options” instead of renewing, said managing partner David McNamara. Since the firm has been a part of “Buffalo’s lower Main Street for nearly 180 years,” it decided to “continue its presence here,” he said.
The firm has a 15-year lease with Benderson Development, leasing half of the building’s rentable space, the fourth through eighth floors, or 85,000 square feet, equivalent to its existing space. The lease also contains two five-year renewal options.
The former state-run eight-story, 165,000-square-foot Donovan Building surrounded by Exchange, Washington and Scott streets, and across from The Buffalo News, had been closed for nearly a decade.
Benderson, based in Sarasota, Fla., is responsible for the redevelopment of the property that is emerging as one of Buffalo’s newest state-of-the art, LEED certified, mixed-use buildings and is slated for completion by the end of the year.
In addition to McNamara, Kenneth Crystal, a partner in Phillips Lytle’s New York City office, along with Michael Powers and JohnPappano, partners in Buffalo, represented the firm.
Shaun Jackson, regional general counsel at Benderson in Buffalo, was the lead attorney in representing the development company on the lease.
In 2008, the Donovan building was acquired by Erie Canal Harbor Development Corporation (ECHDC), the agency responsible for the development of Buffalo Inner Harbor, and a subsidiary of Empire State Development (ESD). Benderson was the winning applicant of ESD’s request for proposals in 2011 and has a purchase agreement in place to take the property’s title on Jan. 1, 2014.
The Canalside area was once “a blighted and underutilized piece of property but today we are seeing incredible progress,” said ESD spokeswoman, Laura Magee. One of the missions of the ECHDC is to “support and promote the creation of infrastructure and public activities” in the overall Canalside project that attract investment and “to enhance the waterfront for residents and tourists in Western New York,” she added.
McNamara said the law firm, which was the first commercial tenant in the Canalside district, “felt like a pioneer since the surrounding area was largely undeveloped and plans were in a state of flux.”
One Canalside is the “key property” in the heart of the 21-acre project being developed by ECHDC, said the ESD spokeswoman.
“We envision Canalside as a critical component in the ongoing rebirth of downtown Buffalo,” said Eric Recoon, vice president, development and leasing at Benderson. The lease was contingent upon Benderson being awarded the redevelopment rights, he added.
The Courtyard by Marriott is also opening a 96-room hotel at One Canalside in spring 2014 and is the first Marriott in Buffalo.
McNamara said the advantages of “a newer more efficient space became obvious” to meet the firm’s long-term needs. “The space has also been designed to increase operating efficiencies, collaboration and the ability to leverage new technology,” he said.
The building’s design includes two main entrances on Main and Washington streets and a lobby extending through the core of the building. The firm will have an exclusive lobby entrance on the first floor. The first floor also has about 4,000 square feet of retail space, and there are plans for a two-story parking garage.
Phillips Lytle overall has 190 attorneys. In Buffalo, a staff of 300, including 120 attorneys, will be moving to the new space. McNamara said there is a “tremendous amount of enthusiasm” about the move and that the new “highly visible” project is considered a “symbol of a Buffalo’s development momentum and bright future.”
Phillips Lytle was established in 1834 by one of Buffalo’s leading citizens, Orasmus Marshall. Grover Cleveland was a partner of the firm from 1874 to 1883, when he was elected governor of New York State. The firm also has offices in Albany, Jamestown, Garden City, and Rochester and in Kitchener, Ontario.
Benderson is among the largest privately held real estate companies. It owns and manages over 700 properties spanning over 40 million square feet in 38 states, according to its website.
Studley’s Gregory Katz, executive vice president and branch manager, and Mike Hopper, managing director, in Miami, handled the lease for the law firm.
The firm of Zeichner Ellman & Krause has relocated its offices to 1211 Avenue of the Americas from 575 Lexington Ave., where it was a tenant for about 15 years.
The law firm, also known as ZEK, has a 10-year sublease for more than 42,400 square feet, the 40th floor, with Ropes & Gray. An affiliate of Beacon Capital Partners owns the 44-story, 2-million-square-foot tower located in the Rockefeller Center district between 47th and 48th streets.
“Our offices at 1211 are larger and more attractive with wonderful views,” said Stuart Krause, partner and chair of Zeichner Ellman’s litigation practice. The space also allows offices and staff to be on a single floor and provides room for future growth, he added.
Zeichner Ellman was represented in-house by partner Frederic Umane. He also heads the firm’s transactional banking, corporate and real estate group.
Ropes & Gray was represented in-house by partner Walter McCabe and associate Christopher Dunn, who are based in Boston.
The sublease rate for the space was reportedly in the low $50s per square foot.
Zeichner Ellman opened its office in New York City in 1980 and offers services in all aspects of commercial legal representation in areas such as domestic and international banking and finance, litigation and arbitration, corporate law and real estate. The firm has more than 50 attorneys with 39 based in Manhattan. It also has offices in Greenwich, Conn., Roseland, N.J., and maintains an office in Ramat Gan, Israel, according to its website.
Newmark Grubb Knight Frank acted on behalf of Ropes & Gray. Rick Marek, president and founder of The Vortex Group along with Kenneth Rapp, vice chairman, brokerage, at CBRE handled the sublease for Zeichner Ellman.
Cushman & Wakefield is the exclusive leasing and management agent for direct leases, according to the property’s website.
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