NEW YORK CITY-Governor George Pataki and lame-duck Mayor Rudy Giuliani announce a powerful corporation that will oversee the funding and development of Lower Manhattan. The plan is already taking hits from city and state officials who are labeling it as a partisan hedge against the possibility of a Democrat moving into Gracie Mansion and taking the reins of redevelopment into his own hands.

NEW YORK CITY-Reports that Morgan Stanley plans to sell its new Midtown building before the paint dries were confirmed yesterday. Lehman Brothers will buy the 32-story building, which cost roughly $400 million to build.

NEW YORK CITY-The Housing Finance Agency kicks in $100 million worth of tax-free bonds and $40 million in tax credits to bolster the state's affordable housing stock. To qualify, owners must agree to keep apartment rents down for 40 years.

NEW YORK CITY-World Trade Center leaseholder Larry Silverstein told an industry crowd yesterday that victory in his legal battle with reinsurer Swiss Re over the World Trade Center bombings is all but assured. "Will there be a shortage of capital to rebuild? It would appear not," the developer informed a packed house at the Waldorf Astoria.

NEW YORK CITY-Massachusetts-based women's diagnostic imaging firm Hologic Inc. sells its headquarters building and a Connecticut mammography facility and net leases the properties back for a 20-year term.

NEW YORK CITY-Boston Properties revealed yesterday that it has signed a $1.06-billion deal to acquire 399 Park Ave. from Citigroup. The transaction is expected to close by the end of September.

NEW YORK CITY-The global investment group's New York office advances its medium-term hold strategy with the acquisition of a Virginia office/apartment complex and the sale of a Minnesota shopping center and a New Jersey office property.

NEW YORK CITY-Where MOMA goes, HoJo follows. The owner of a Howard Johnson hotel in Soho will take the Cendant brand across the East River. The $7-million property is scheduled to open next spring.