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NEW YORK CITY-Top-tier law firm Clifford Chance US LLP has left two of the city’s major property owners hanging out to dry, choosing to walk away from deals at Boston Properties’ Times Square Tower and the Macklowe Properties development at 340 Madison Ave. Instead, the London-based legal powerhouse will set up shop on 14 contiguous floors at 31 W. 52nd St. in a 380,000-sf sublease deal from Deutsche Bank.

Clifford Chance is currently operating out of three locations, with the majority of its staff lodged in a 330,000-sf space in the Met Life Building, 200 Park Ave. Aside from giving the firm an extra 50,000 sf and the capacity to house 500 lawyers, he new deal, includes expansion options in 10 and 15 years. The lease commences in May 2004 and the space will be built out beginning this summer. Financials on the transaction have not been released.

“This is a unique time in the New York real estate market, where we have an opportunity to secure premium space which will well serve us and our clients for many years to come,” says John Carroll, Clifford Chance’s regional managing partner for the Americas. “We’ve outgrown our current space spread out over three New York buildings, so we are delighted to find this new facility, which will allow us to consolidate our New York practice in one state-of-the-art space and will offer our clients and our people the best amenities and technology.”

Insignia/ESG’ Robert Stillman, Bob Alexander and David Mauer-Hollander reportedly brokered both sides of the deal, which could be worth more than $20 million, but Insignia officials were unavailable for comment by press time.

As to the two new buildings, Boston Properties looked to have the edge on the Clifford Chance deal until Harry Macklowe entered the fray, reportedly offering rents $15 per sf below what Boston Properties was asking. Meanwhile, the 1.1 million-sf 7 Times Square, still stinging from Arthur Andersen’s bailing on its 621,000-sf commitment, is said to have leased less than 10% of its space, and 340 Madison has yet to reveal a single completed lease.

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