New York's Metropolitan Transportation Authority issued a request for proposals Thursday for a private developer to manage 65,000 square feet of retail and commercial space at the Fulton Street transit center.

It's the latest move in a real estate scramble in lower Manhattan that has several parties, including the World Trade Center and World Financial Center, looking to add retail tenants and capitalize on the growth of the area since the Sept. 11, 2001, terrorist attacks.

At the World Trade Center, the Port Authority of New York and New Jersey approved an agreement valued at $1.4 billion with Australian shopping center owner Westfield Group for a 50% stake in the World Trade Center's retail space, expected to open in 2015 at the earliest.

Brookfield Office Properties, meanwhile, is planning a retail redevelopment of the World Financial Center, while Howard Hughes Corp. has a project in the works at South Street Seaport.

"This growth has been driven by a rapidly expanding residential population, the recovery and expansion of the downtown office market, and substantial public and private investment in the area," the MTA said in its RFP document.

The Fulton Center will eventually link 11 subway lines, Port Authority Trans-Hudson, or PATH service, and the World Trade Center site. New York City commuters have long argued that transferring among subway lines at the existing Fulton Street station is too complicated. The MTA projects that 300,000 transit customers will walk through the facility on an average workday.

Proposals are due Nov. 2. The master lessee must handle leasing and operations of the structure as well as the historic Corbin building, the Dey Street entrance and the attached concourse under Dey Street.

The redevelopment will include the integration of the Corbin building, at Broadway and John Streets and listed on the National Register of Historic Places, with the Fulton building.

MTA officials say the reconstructed complex will include more than 50 revenue-generating multimedia displays. They expect to complete the $1.4 billion Fulton Center in June 2014. By then, the MTA anticipate the commercial usage areas and at least a majority of retail stores open for business.

The MTA has been looking to generate real estate revenue and reduce rent exposure to offset the costs of the Fulton Center and other major projects, including East Side access for Long Island Railroad trains and the Second Avenue subway line. "The successful proposer will propose rental terms that are financially advantageous to the MTA," the authority said in the RFP document.

"This out-of-the-box approach to managing our property will optimize rents coming to the MTA while ensuring the highest standards of daily maintenance are kept for our customers," MTA Chairman and chief executive Joseph Lhota said in a statement.

The MTA last year signed a $5 million agreement with technology giant Apple Inc. for prime space inside Grand Central Terminal.

The authority plans site tours of the center on Aug. 15 and a pre-proposal conference on Sept. 12. Proposer questions are due Sept. 17. The MTA will interview companies in December.

Moody Investors Service rates the MTA's bonds Aa2, while Standard & Poor's and Fitch Ratings assign AA ratings.

Subscribe Now

Independent and authoritative analysis and perspective for the bond buying industry.

14-Day Free Trial

No credit card required. Complete access to articles, breaking news and industry data.