"We're going to come up with a resolution," WTC leaseholder Larry Silverstein said at the time. He noted that he expected his firm will develop the entire site. He noted that buildings on the site are ideally suited for use by corporate users requiring large amounts of space, as opposed to residential use. "That's its best and highest use."
Mayor Michael Bloomberg had called on Silverstein to "do the right thing and hand off responsibility for building Towers 3 and 4, in exchange for a reduction of its rent." In a letter issued by the Silverstein group, officials say that the notion that increased government involvement will speed things up "does not pass the smell test. Construction of towers 3 and 4 cannot begin until the government (specifically, the Port Authority) completes the excavation and construction of the new slurry wall. Government schedules call for completion in mid-2008, and Silverstein has vowed to begin construction immediately thereafter. They also point out that any other developer who came in after would likely proceed more slowly because without insurance proceeds, they would have to borrow more money and raise equity that would require a substantial return on investment.
Bloomberg called on the Port Authority to commit to occupying one of the towers, while working to identify a developer for the other, so that all projects can proceed simultaneously at the same time. "If we immediately start building retail stores along with a commercial, residential, and hotel mix, Lower Manhattan will become one of the most energetic and exciting neighborhoods in New York."
"There is nothing 'fair' about taking the two best sites and giving one to government and the other to an outside developer," Silverstein officials said. "What the city [and the Port Authority] propose is a Soviet-style confiscation. Larry Silverstein has cooperated in a four-year process of planning and re-planning the site, though it delayed rebuilding. He even re-designed the Freedom Tower when government miscommunication led to a change in the security standard. And, most important, he has continued to pay approximately $10 million in rent to the Port Authority every month since 9/11, even though the buildings that he leased are gone."
Want to continue reading?
Become a Free ALM Digital Reader.
Once you are an ALM Digital Member, you’ll receive:
- Breaking commercial real estate news and analysis, on-site and via our newsletters and custom alerts
- Educational webcasts, white papers, and ebooks from industry thought leaders
- Critical coverage of the property casualty insurance and financial advisory markets on our other ALM sites, PropertyCasualty360 and ThinkAdvisor
Already have an account? Sign In Now
*May exclude premium content© 2024 ALM Global, LLC, All Rights Reserved. Request academic re-use from www.copyright.com. All other uses, submit a request to [email protected]. For more information visit Asset & Logo Licensing.
