NEW YORK CITY-The Durst Organization has gotten the nod for a minority equity stake in 1 World Trade Center, the Port Authority of New York and New Jersey said late Wednesday afternoon. Durst will invest at least $100 million and take over leasing and management at the 2.6-million-square-foot office tower under the proposal selected by the Port’s board of commissioners following an executive session.
In a release, the Port says that Durst’s proposal best aligned with the agency’s interests in the long-term success of 1 WTC and because of the firm’s track record in developing green office towers. The LEED Platinum-certified 1 Bryant Park, which Durst developed in partnership with anchor tenant Bank of America, had its formal opening in Midtown this past spring.
At one time, six major owner/developers were vying for the membership interest in One World Trade Center LLC. As of Wednesday’s vote, the field had been narrowed to Durst and the Related Cos. At its regularly scheduled meeting last month, the board put off a vote on making its final pick, possibly until the July meeting.
“We’re extremely pleased that some of the most prominent developers in the country saw market value in this world-class office tower, and engaged in an extremely competitive process for a stake in it,” Port Authority chairman Anthony Coscia says in a statement. “What is most important is that we reach an agreement that is good for the building, for the World Trade Center site and for the region.”
Although the Durst Organization had gone on record in early 2007 with opposition to the WTC redevelopment, co-sponsoring full-page newspaper ads saying that the project was ill-conceived and too costly, the company issued a statement Wednesday expressing satisfaction with the Port’s selection. “The building is a symbol of New York’s resilience and strength, and we have tremendous confidence in its future success,” company president Jody Durst says in the statement. “The World Trade Center site is, perhaps, the most complex building project ever undertaken, and the Port Authority’s progress on the construction of One World Trade Center is to be congratulated.”
Conversely, a statement from Related chairman and CEO Stephen Ross expresses disappointment with the decision, saying that his company “thought we offered a great vision for this iconic destination development and Lower Manhattan.” Nonetheless, Ross says, “We wish the Port Authority and their new partner well.”
The next step in the process will be for Durst and Port Authority staff to finalize an agreement over the next 30 days, subject to the board’s approval. Approximately 1.3 million square feet of office space at WTC has been preleased, including commitments from state and federal agencies totaling 1.1 million square feet. The 1,776-foot tower is scheduled for completion in 2013.
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Paul Bubny
Paul Bubny is managing editor of Real Estate Forum and GlobeSt.com. He has been reporting on business since 1988 and on commercial real estate since 2007. He is based at ALM Real Estate Media Group's offices in New York City.
