A battle between high-profile landlords to lease millions of square feet of vacant Central office space intensified yesterday after Great Eagle Holdings announced Goldman Sachs would stay in Citibank Plaza. United States investment bank Goldman Sachs had earlier threatened to move to Li Ka-shing's Cheung Kong Center. Property analysts said they would not be surprised if Great Eagle had cut the bank's rent as much as 40 per cent to match or better Hutchison Whampoa's $35 to $38 per square foot offer. It had been widely rumoured the merchant bank would opt for five floors in Hutchison Whampoa's Cheung Kong Center on the site of the old Hilton Hotel, just a stone's throw from Citibank Plaza. Vickers Ballas property analyst Herbert Lau Chung-kwan said he was not surprised by the Great Eagle move. 'Landlords will do anything to keep an anchor tenant even if they have to cut rents by half,' he said. According to many analysts, the US bank had been offered a nine-year lease with a 2.5-year rent-free period at prices well below the asking rent of $50 per square foot. Both Goldman Sachs and Great Eagle Holdings refused to discuss any of the terms of the new lease, which according to the landlord, was for two years. Some property analysts said Goldman Sachs decided to stay with its present landlord simply because Great Eagle 'had bitten the bullet'. 'When it became apparent that Goldman might go, Great Eagle decided it was time to bite the bullet and match the Hutchison offer,' one analyst said. Landlords, particularly in the core Central area, are increasingly having to offer longer rent-free periods - months rather than weeks - and to slash asking rents in order to maintain the existing tenant base and attract new tenants. Leading landlords such as Hongkong Land admit they have been renewing leases at 30 per cent less than previous leases to keep occupancy rates up. Most analysts had believed Goldman Sachs was on the verge of signing a nine-year lease at $35 to $38 per square foot. The bank was widely believed to have been paying in 'the high $50s' for four floors in Citibank Plaza. Mr Lau said the rent cut would tip the balance in favour of Great Eagle. When a bank like Goldman Sachs looked at the cost of moving, renovations and setting up computer operations, the rent cut was incentive enough to stay put in Citibank Plaza. 'They would have been paying something like $20 to $30 per square foot to fit out,' Mr Lau said. However, according to some analysts, there may have been other reasons for the bank's decision to stay with its present landlord. The media had been happy to portray the Goldman Sachs move to the Cheung Kong Center as a done deal but that had never been the case, one analyst said. With much space coming on to the market in the next two years, tenants are swamped with choices. 'For the developers, it is a tough world out there right now,' the analyst said.