NEW YORK | 1 Albany St (5WTC) | FT | FLOORS

Continuing the discussion from NEW YORK | World Trade Center District:

The looming World Trade Center ‘stalemate’

BY JOSH ROGERS | September 11, 2014

The World Trade Center’s epic disputes over power and money have for the most part been resolved, but there’s at least one remaining that could prevent construction of one of the proposed towers.

“We are at a stalemate with them at the moment,” David Emil, president of the Lower Manhattan Development Corp., told Downtown Express last week, referring to the corporation’s dispute with the Port Authority. “It’ll be years before it’s resolved.”

The L.M.D.C., a federally-funded corporation formed to manage Downtown’s post-9/11 recovery, owns the World Trade Center Tower 5 site, and Emil said the Port wants to take it over without paying any money.

The problem, Emil said, is the site is worth $300 million to $500 million, and in addition, the L.M.D.C. spent hundreds of millions to get the site ready for development — a figure that ballooned because of the plagued and long-delayed demolition of the Deutsche Bank building, where two firefighters were killed battling a 2007 blaze.

Emil said the Port is arguing that it effectively became the owner of the site under a 2006 agreement, and that the development corporation has been acting as the Port’s agent.

“We say, yeah, that may be. If we were your agent, you have to pay us the $300 million that it cost to take this thing down, to which they say no, that was your problem you owned it — you see, you can’t have it both ways guys,” Emil said during an impromptu interview at the site Sept. 2nd, after a ceremony celebrating the opening of a temporary green market and public plaza there.

Last week, the Port Authority did not dispute Emil’s characterization of the situation, and a spokesperson declined to comment for this article.

On Tuesday, Scott Rechler, the Port’s vice chairperson, said the higher demolition costs were not a reason to revisit the agreement, but he also thought the dispute would not lead to delay.

“We’re going to live by the agreements of ‘06, and I think everyone will – to move it forward,” he told Downtown Express Sept. 9.

The 2006 deal, a memorandum of understanding between the Port and the L.M.D.C., involved a land swap of the Tower 5 site and the World Trade Center’s Performing Arts Center site.

The Port had originally planned to develop the site as an office tower but after a 2007 deal to move JP Morgan Chase headquarters Downtown fell through, it has since said it would wait for the market to dictate the best use of the site.

Emil said the Port is still looking to develop the site commercially, but the L.M.D.C. feels the quickest and most lucrative way to proceed is to build a residential tower.


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