C
ity agencies have been signing large office leases in New York City, providing relief to struggling landlords. One notable example is the Department of Citywide Administrative Services' agreement to take over 640,000 square feet at 110 William Street, owned by Pacific Oak and Savanna. Another recent deal was the Department of Aging's lease of 80,000 square feet at Alexander Rovt's 14 Wall Street.

    The city leases have raised concerns about potential bribery and money laundering in commercial property deals. Officials seized phones from Ingrid Lewis, Jesse Hamilton, and Diana Boutross as part of an investigation. Lobbying efforts by office landlords who benefit from these leases are under scrutiny.

    Property owners must disclose interactions with government agencies when trying to influence procurement decisions or shape the terms of a request for proposals (RFP). Last year, Brookfield disclosed lobbying DCAS about its 15 MetroTech Center property and potential acquisition of assets. The company also reported leasing conversations with various city agencies regarding space at several properties.

    The Manhattan district attorney's office is investigating certain leases, but details are not yet known. Owners with struggling office properties may have seen city leases as a stabilizing force, given the mortgages on many of these properties have entered special servicing.