Thank you for sharing!

Your article was successfully shared with the contacts you provided.

NEW YORK CITY-Many major pieces in the complex jigsaw puzzle that is Ground Zero fell into place this afternoon as the Port Authority of New York & New Jersey officially approved the proposed reconstruction framework it created with Silverstein Properties. Key to the agreement, which was drafted five months ago, is the assumption of control of the Freedom Tower by the PA–essentially making Silverstein the hired contractor for the build. The Port also confirmed its commitment to a 600,000-sf lease at 4 World Trade Center.

Almost as an aside, in his address to the board, executive director Kenneth J. Ringler also revealed lease commitments of one million sf in the Freedom Tower by the federal General Services Administration and the New York State Office of General Services. No lease details were provided.

Under the terms of the agreement, the PA takes control of the Freedom Tower build and that of Tower Five, currently the site of the Deutsche Bank Building, which is being demolished. The PA is levying on itself a daily fine of $300,000 for every day the building is late, said chairman Anthony Coscia in a press briefing after the meeting. According to PA spokespeople, that daily fine will go to Silverstein coffers.

The PA will also be responsible for the transportation hub and some 490,000 sf of retail. That includes 200,000 sf in the “hub and the pedestrian concourses and the remainder in Towers Two, Three and Four,” said Ringler.

Tower Four is the also the future PA home office, and today, the board officially accepted the plan for 600,000 sf there. Coscia explained that the 30-year lease has a base rent of $59 per foot with escalations to “$65 by year six.”

The 1.8-million-sf Tower Four, along with Two (2.4 million sf) and Three (two million sf), will remain in the Silverstein Portfolio. That is, as long as the developer fulfills its end of the bargain. The PA will turn the site for Towers Three and Four over to Silverstein by mid next year, and Two goes to the developer by mid-2008. The firm will have four years to complete Three and Four and four and a half years to wrap up Two. If the company fails in that commitment, ownership reverts to the Port Authority.

“There is difficulty in getting public concession,” reflected Coscia, summing up the last five years of fits and starts. “There is great value in getting opinion, and the delays they cause are worthwhile. But the time has come to build.”

Want to continue reading?
Become a Free ALM Digital Reader.

Once you are an ALM digital member, you’ll receive:

  • Unlimited access to GlobeSt and other free ALM publications
  • Access to 15 years of GlobeSt archives
  • Your choice of GlobeSt digital newsletters and over 70 others from popular sister publications
  • 1 free article* every 30 days across the ALM subscription network
  • Exclusive discounts on ALM events and publications

*May exclude premium content
Already have an account?

Dig Deeper



Join GlobeSt

Don't miss crucial news and insights you need to make informed commercial real estate decisions. Join GlobeSt.com now!

  • Free unlimited access to GlobeSt.com's trusted and independent team of experts who provide commercial real estate owners, investors, developers, brokers and finance professionals with comprehensive coverage, analysis and best practices necessary to innovate and build business.
  • Exclusive discounts on ALM and GlobeSt events.
  • Access to other award-winning ALM websites including ThinkAdvisor.com and Law.com.

Already have an account? Sign In Now
Join GlobeSt
Live Chat

Copyright © 2021 ALM Media Properties, LLC. All Rights Reserved.