A news about fireproofing:

Oct. 23 (Bloomberg) — Real estate investor Peter who negotiated the nation’s biggest property deal of the year in buying Manhattan’s Worldwide Plaza, is now in charge of a skyscraper that’s 40 percent empty.

The Italian marble south lobby of Worldwide Plaza, the gateway to 14 vacant floors, is quiet. It’s one reason Duncan, president of George Comfort & Sons Inc., was able to buy the 49- story building in July for $590 million, two years after it sold for almost three times as much.

The purchase price may allow Duncan to undercut the rents competitors charge as he leases his 709,000 square feet. Manhattan has 59 million feet of available offices, according to brokerage Colliers ABR, the most since June 1996, and rents for the best space are down more than 30 percent from their peak last year. Duncan’s outcome may help investors determine whether it’s time to resume buying New York office buildings.

“They are one of the first waves of risk-takers here in this asset recovery business,” said Robert Freedman, executive chairman of New York-based brokerage FirstService Williams. “They made a great deal if they can manage this risk.”

Pinched by scarce credit and the recession, New York City may hit a record low dollar value for commercial property sales this year. Manhattan office properties have lost almost 47 percent of their value since 2007, more than any other major U.S. city, according to the Concord Group, a consulting firm in Newport Beach, California.

Investor Signal

If Comfort and its partners lease the space at 825 Eighth Ave. quickly, it will be a “signal for investors” that could increase their appetite for risk, said Jim Frederick,a principal at Colliers ABR, a New York-based commercial broker.

Not a single lease for more than 250,000 square feet in Midtown has been signed this year, according to CB Richard Ellis Group Inc.,the world’s biggest commercial brokerage.

Tenants have plenty to choose from. Just eight blocks south at Eighth Avenue and 42nd Street is 11 Times Square, a new 1.06 million square-foot office tower that’s almost finished and has no tenants. Just up the street is 3 Columbus Circle, the former Newsweek Building, where 417,000 square feet is available, according to Colliers. Six blocks southeast lies the former New York Times building, where all 644,000 square feet is up for lease.

Comfort’s advantage may be price. The partnership paid $370 a square foot for Worldwide Plaza, while competitors paid $1,000 a foot or more for similar buildings at the height of the five- year U.S. property boom.

Rents Fall

“No longer will they have to get $80 or $90 or $100 a square foot” for a lease, Robert Sammons, research director at Colliers, said in an Aug. 20 interview on Bloomberg Television. “They can do deals in the 30s, 40s or 50s now, which is going to help start to move the market.”

Rents for so-called Class A Midtown offices averaged $68.38 a square foot at the end of September, according to Colliers data. The law firm Cravath Swaine & Moore LLP agreed to pay almost to $100 a foot when it renewed its 600,000-square-foot lease at Worldwide Plaza in 2007, a person involved in the transaction said at the time.

“I look at the vacancy as being an opportunity,” said Duncan, whose company owns or has interests in eight other New York office properties.“The success of any deal is dependent on how well occupied you keep your buildings.”

Comfort, a closely held family-owned company, and its partners set aside “in excess of $100 million” to cover leasing costs, including maintenance and a reserve to renovate for new occupants, Duncan said in an interview. He declined to disclose the building’s expected first-year yield, or capitalization rate.

Higher Vacancies

The vacancy rate for the highest-quality offices in Manhattan was 12 percent in September, near the highest in more than 12 years, Colliers said. Tenants haven’t been in a better position since the mid-1990s, when the market was coming out of a recession, Sammons said.

Duncan’s challenge is the latest for a skyscraper that helped gentrify part of the west side in the 1980s. Built on the old 50th Street site of Madison Square Garden, it was the first sizable skyscraper built that far west in Manhattan. A PBS program, “Skyscraper: the Making of a Building,” documented the construction.

William Zeckendorf Jr. developed the property. It was the first New York commission for Skidmore Owings & Merrill architect David Childs, who went on to design the nearby Time Warner Center.

Macklowe’s Purchase

Developer Harry Macklowe  purchased Worldwide Plaza and six other Manhattan buildings from Blackstone Group LP in February of 2007, the same day Blackstone bought billionaire Sam Zell’s Equity Office Properties Trust in what was then the biggest leveraged buyout in history.

A year later, Macklowe lost all seven properties to lender Deutsche Bank AG when he was unable to refinance almost $7 billion in short-term debt he used to acquire the buildings.

Deutsche Bank  financed a $470 million loan for Comfort’s group to make the purchase. The partners include RCG Longview, an investment firm whose founders include former Shearson Lehman Brothers Inc. Chief Executive Officer Peter Cohen; and DRA Advisors LLC, a New York-based sponsor of real estate investment funds.

“We wanted to put together a group that has been through the wars a little bit,” Duncan said. The partners “are all long-term holders of real estate.”

The floors they need to rent make up the second-biggest empty space in the city: 14 stories at the base of the tower vacated in June by the advertising firm Ogilvy & Mather.

Empty Space

While some floors have been stripped to the fireproofing, traces of the ad agency remain. The walls on the fourth floor are covered with artwork, including a red and black 1960s-style pop-art mural that reads: “Next time there’s a war for sale, it’s alright to say no thank you.”

Representatives of accounting firm Deloitte LLP have spoken with Comfort about taking some of the space, according to two people familiar with the discussion. They declined to be identified because they weren’t authorized to speak publicly about the space.

Jonathan Gandal, a spokesman for Deloitte, declined to comment.

“We’ve had lot of people look at the available space,” Duncan said. “We are actually discussing having active negotiations with certain tenants. And that and $2.25 gets you a ride on the subway.”