Space for rent

Known as annual rateable value (ARV), this is the amount paid by businesses operating in the city.

Sources at the City Corporation said the “house rates” or city rent for Nicholas Tower was slashed earlier this year by 50 percent — from $600,000 to $300,000 per annum.

They added that the reduction was approved by the City Assessors at the City Corporation and was done on the grounds that since the building was completed in 2003, only six of the 23 floors are now being occupied.

But Nicholas Tower is not the only company to seek a reduction, as other companies have done the same over the past year, according to Port-of-Spain Mayor Murchison Brown.

Brown dismissed the view that Nicholas Tower was given preferential treatment by the corporation.

“We get requests like this from time to time, it is nothing unusual,” he said of the decision to reduce the rent paid by Nicholas Tower.

He noted that the assessor looked at the proposal brought in by the company and recommended a new rate.

In a recent meeting with the PoS City Corporation, Nicholas Tower officials argued that the city rent must be reduced in light of its present occupancy status. The decision was taken to reduce their “house rates” by 50 percent until more floors were occupied.

The new price, which is effective this year, will remain like this until the other 17 floors of the building are filled, sources at the city’s assessment department said.

At present, the only tenants of the building are :

*The Trinidad and Tobago Stock Exchange Limited, which operates from the tenth floor;

*The Trinidad Union Club on the 22nd floor;

*Clico Abercromby Street Agency which occupies the ninth floor;

*Nicholas Towers Property Management on the fifth floor;

*A parking lot for resident tenants;

*Commercial shops like Rituals Cafe, Imperial Optical and Continental Airlines, located on the ground floor.

Chief Executive Officer (CEO) at the City Corporation, Laraine Alexander said while the rent was reduced for Nicholas Tower, other companies have also benefitted. She noted though this is not the first time the city assessors have had to review rental rates for companies in Port-of- Spain.

“I would not disclose the names of the other companies because of the confidentiality factor, but every year we review the rates depending on things such as the occupancy of the property,” she said.

Alexander explained that since only six of the 24 floors in Nicholas Tower are occupied, the “owner is not receiving the proper rates.”

“It is only fair that they pay for what they are using and this is where the corporation stepped in,” she said. She said rates are reviewed under Parliamentary Act 21 of 1990.

She explained that the calculation of the ARV is based on a number of criteria, including the location of the building, its size and floor space.

The Nicholas Tower built by real estate magnate, Issa Nicholas, was completed in late September 2003 at a cost of over $100 million.

Each floor offers 8000 square feet of air-conditioned space but the price range of the floors varies.

According to one source, the rent on the ground floor stands at $21 per square foot. The upper floors are rented for $14 dollars per square foot, and that includes the upkeep of the bathrooms and other surroundings. This means that if a company wants to rent an entire floor at $14 per square foot, they will have to pay $112,000 per month or about $1.3 million per year.

Renting at $20 per square foot will cost a business $160,000 per month or $1.9 million per year.

Clico Abercromby Street office, which occupies the ninth floor of the building is said to be paying a monthly rent of $60,000 per month or $720,000 per annum, while the TT Stock Exchange Limited is said to have paid in excess of $6.5 million for the entire tenth floor.

Real estate agents have cited the high cost of floor space at buildings in Port-of- Spain as the main reason why most properties are being blanked by city businesses.

“The rent in some of the places are just too ridiculously high so clients refuse to associate themselves with those places,” an agent at a PoS firm said.

They also attributed the exorbitant rent being asked for as one of the reasons why Nicholas Tower was unable to get tenants to occupy its floors.

One company, which now occupies another building in the city and which spoke on the condition of anonymity, said they attempted to get the rent reduced but Nicholas Tower refused to budge.

The problem was partly as a result of the shape of the building which saw space being wasted, said the official.

At the Tower last week, one company official admitted that only six of the 23 floors are occupied. His comments came as permission was being sought to photograph the directory lisiting for companies.

“If you look at it in perspective, it does not look good that after almost three years in operation, more than half the floors here are vacant,” he said.

Another major real estate player, Furness Trinidad Limited, is however wooing new business. Director, Patrick Ferreira, said the company has had no problems in getting tenants, even as it was undergoing a major face-lift late last year.

“When renovations were 90 percent complete all the floors of the building were occupied. We had no problem in getting people to rent here at all,” he said.

Each floor at Furness offers 15,000 square feet of space with the rent standing at $15 per square foot. At such a rate, this works out to be $225,000 per month or $2.7 million annually.