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Moinian Aims To Build Downtown Hotel Financed in Part by $50M in Liberty Bonds


By DAVID LOMBINO
April 11, 2006

Developer Joseph Moinian is aiming to break ground next month on a 53-story hotel and condominium near ground zero that could be financed in part with $50 million in Liberty Bonds - financing that Larry Silverstein is also seeking.

The city has not yet awarded the bonds to Mr. Moinian, but a city official familiar with the application said the Bloomberg administration supports his project, which it sees as a relatively inexpensive way to encourage mixed-use development in Lower Manhattan.

The official said a hotel condominium could help spur demand at ground zero, and that $50 million in Liberty Bonds is not significant enough to upset negotiations with Mr. Silverstein, who has applied for the remaining $1.67 billion of the city's Liberty Bonds.

The city has not yet awarded any Liberty Bonds to Mr. Silverstein in an effort to compel the developer to renegotiate his 99-year lease on the ground zero site.

A spokeswoman for the Moinian Group, Daphne Viders, said yesterday that the bond application is being held up because Mr. Moinian has not yet submitted all the necessary paperwork to the city. She said a luxury hotelier would partner with the developer in the project; press reports have said it will be part of the W Hotel chain.

Last April, Mr. Moinian applied for $147 million of the tax-exempt bonds. In December, the president of the agency that will award the bonds, Andrew Alper, said the city was considering awarding the developer about $50 million. That amount of tax-exempt financing could save the developer about $2 million a year versus traditional commercial financing. If Mr. Moinian is not awarded the bonds, he has said he will not build the hotel portion of his project and will just construct apartments.

Mr. Moinian's 440,000-square-foot project, estimated to cost about $240 million, is slated to rise on an empty lot behind the Deutsche Bank building, which was severely damaged in the terrorist attacks of September 11, 2001, and is now being demolished. An office tower built by Mr. Silverstein is scheduled to occupy the Deutsche Bank building site, but the site has been mentioned as a possible residential building in recent negotiations between Mr. Silverstein and the Port Authority. It also could contain a hotel.

The same month that Mr. Moinian applied for the bonds, Mr. Silverstein applied for the city's remaining allotment of Liberty Bonds, which the developer said he would use to build 10 million square feet of commercial office space in five towers.


© 2006 The New York Sun, One SL, LLC.