Posted Mar 17, 2010, 1:28 PM
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New Yorker for life
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Join Date: Jul 2001
Location: Borough of Jersey
Posts: 51,917
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A deal has yet to be reached, but already the anti-rebuilding forces are complaining...
http://www.observer.com/2010/real-es...ss-ground-zero
The Business of Ground Zero
By Eliot Brown
March 16, 2010
Quote:
The public sector is now on the verge of putting itself in a position to relive the very financial pain it endured a generation ago.
A yearlong battle over the World Trade Center site between private developer Larry Silverstein, the Port Authority and the city seems to be ending, with all three parties converging on a plan to use the financial backing of various public-sector sources to help finance two of the three skyscrapers Mr. Silverstein had planned.
While the details are still under discussion and talks could yet break down, it would put hundreds of millions, if not billions, of additional public dollars at risk, as some combination of the Port Authority, the city and the state would likely back the financing on the bulk of the $4 billion–plus cost of the two privately built towers. Mr. Silverstein would be required to use hundreds of millions in insurance money and additional capital.
Taken with the $3.1 billion, Port Authority–owned One World Trade Center (formerly the Freedom Tower) currently rising, the Silverstein deal, should it indeed mature, would mean nearly 7 million square feet, or two and a half Empire State Buildings, constructed within the span of a few years on one site—all with only a single private tenant in place, China-based Beijing Vantone, for a relatively trivial 190,000 square feet, or six floors.
But today many landlords—who see Mr. Silverstein’s towers as potential competition that would drive down rents—tend to restrict their grumblings to private forums, and the biggest office brokers in the city are generally conflicted.
Anthony Malkin, grandson of Mr. Wien and an owner of the Empire State Building, is one of the few to publicly criticize the plan today; he took out a set of ads in 2007, with Douglas Durst, Seymour Durst’s son, urging a halt to construction of One World Trade Center.
...In fairness to supporters of the government-backed plan for two Silverstein towers, there are no appealing options for financing the redevelopment. Those who have urged the two-tower plan, including the Bloomberg administration, have said the office market is in a tremendously different place than it was a few decades ago, and Manhattan has a very small amount of new, modern office space, particularly downtown.
“Financing commercial buildings is obviously difficult today, but there will continue to be enormous demand for new office space in the long term,” said Andrew Brent, a spokesman for Deputy Mayor Robert Lieber.
...Perhaps as a result, whatever criticism there is tends not to have much effect, a lesson learned by Mr. Malkin. “My take-away was that Douglas and I really accomplished about as much as my grandfather and Douglas’ father accomplished when they tried it, which was basically nothing,” Mr. Malkin said of publicly criticizing the plan. “So long as we were prepared to run ads at our cost, people were prepared to return our phone call, but not to any effect.”
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NEW YORK is Back!
“Office buildings are our factories – whether for tech, creative or traditional industries we must continue to grow our modern factories to create new jobs,” said United States Senator Chuck Schumer.
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