It also ends weeks of speculation. According to at least one inside observer, the frontrunner in the talks was a joint venture headed by Boston Properties and Brookfield Properties. In an interview tonight, he expressed his surprise at the turn of events.
The Port Authority put out requests for bids early last spring for a company to lease, manage and operate the complex for a 99-year term in what has turned out to be a speedy and heated process. The complete package bidders scrambled to claim includes the Commodities and Exchange Center and Five World Trade Center. Eight initial bidders entered the fray to take the property, a group that was narrowed down to four finalists this past December, Vornado, Boston Properties, Brookfield Properties and Silverstein Properties.
An end-date for the requests was on tap for December, but that date was extended. Shortly thereafter, Boston Properties and Brookfield formed the joint venture with Blackstone Real Estate Advisors, CIBC Partners and Deutsche Bank in a strategy to increase their firepower among bidders.
When the initial decision to go private with the complex was made in 1998, insiders thought the building would fetch $1.5 billion; in the end that figure proved to be far off the mark. The property's star quality and international appeal prevailed, allowing the building to fetch more than double what was expected.
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