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Silverstein, Port Reach Ground Zero Accord

NEW YORK CITY-The tentative agreement between the developer and the Port Authority appears to end a 16-month impasse over progress at the World Trade Center site.

By Paul Bubny | Updated on March 25, 2010

NEW YORK CITY-The 16-month impasse over construction financing at the World Trade Center site has apparently come to an end. Silverstein Properties Inc. and the Port Authority of New York and New Jersey on Thursday presented the Port’s board with a tentative agreement to provide financial support for two of SPI’s planned towers while allowing the third to be phased in over time. The two sides had agreed to keep negotiating after missing an arbitration panel’s March 12 deadline to reach an agreement.

According to a joint statement from the Port, SPI, the Bloomberg administration and the states of New York and New Jersey, the plan entails restoring the east side of the WTC site to at least street level, completing SPI’s Tower 4 by 2013 and phasing in the developer’s Towers 2 and 3 over time. All other projects, including One World Trade Center, the 9/11 Memorial, the WTC Transportation Hub and other public infrastructure, will continue moving forward. The statement says the accord between the developer and the Port strikes “an important balance between the redevelopment goals, financial risks and rewards between the public and private sector.”

About 60% of Tower 4, also known as 150 Greenwich St. and already under construction, is being pre-leased to the Port and city agencies. Under the proposed development plan, the Port would provide a master lease for Tower 4, thus supporting the issuance of SPI’s Liberty Bonds to partly finance the 64-story property’s construction costs. SPI would reimburse any payments made by the Port under the master lease.

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