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Power Struggle Heats Up While Development Moves Slowly at Ground Zero

This fall, progress on a few construction projects at Ground Zero continued to crawl, while the real action seemed to be in the offices of local politicians. New York City Mayor Michael Bloomberg appears to be getting ready for a fight with New York Governor George Pataki over the fate of proposed office space here. Meanwhile, the Port Authority of New York and New Jersey, which owns the property, continues to assert itself over what will happen.

Work on Santiago Calatrava’s transit station for the Port Authority has just gotten underway, while the World Trade Center Memorial Foundation, which oversees funding on the memorial and cultural buildings, on December 5 announced that it had issued a request for proposals for a memorial construction manager. The toxic Deutschebank Building to the south is slowly being dismantled to make way for park and office space. On November 29, Goldman Sachs, broke ground for its Pei Cobb Freed Partners-designed headquarters, just northwest of Ground Zero.


But most dramatic is the developing struggle between Mayor Bloomberg and Governor Pataki. During his first term, Bloomberg focused on a failed bid to develop a stadium on New York’s West Side, and mostly deferred to Pataki regarding development at the World Trade Center site. He changed that stance in late October, just before his reelection, when he told the New York Daily News editorial board that he would prefer to see more residential development on the site. Currently the site is slated to include about 10 million square feet of office space. Bloomberg also told the board that the city would be better served by removal of developer Larry Silverstein who owns the right to build the Pataki-backed Freedom Tower. In mid-November, Bloomberg named six new members to the Lower Manhattan Development Corporation (LMDC) board of directors. Four of the new appointees are senior advisers to the mayor. Pataki subsequently appointed three of his backers to the board. The LMDC is a joint state-city corporation that oversees rebuilding in Lower Manhattan. Its board has 16 members, eight appointed by the mayor, and eight by the governor.

Pataki has since backed away from his long-held position that all of the space lost when the World Trade Center towers collapsed should be rebuilt, telling the Post, “I don’t know that 10 million is the magic number. I’m not going to project where things might be with office space demand, five, 10 years from now.”

As the mayor and governor positioned themselves for a face-off, the Port Authority of New York and New Jersey (PA) has been flexing its own muscles. In mid-November, the PA said it will reduce the size of the chiller plant it is constructing to service the site. This means that Silverstein will have to construct his own chillers to service the Freedom Tower and other office buildings at the site, increasing the cost for his project reportedly by as much as $100 million. A few days later the PA released plans to develop up to 550,000 square feet of retail at the Trade Center along Church Street, at the bases of towers 2, 3, and 4, which have yet to be designed. The development would replace the World Trade Center’s original retail mall, which, PA chairman Anthony Coscia pointed out in a statement, “was one of the most successful in the country.” At the same time, the PA offered to assume control of construction of the World Trade Center Memorial, and to cover any cost overruns. The offer would streamline building on the complex PA-owned site. But some point out that the WTC Memorial Foundation’s fundraising efforts would be hurt if the public perceives that the memorial’s costs could be absorbed by the PA. Others say it would be unwise for the foundation to give up control over the construction, even as cost estimates have gone as high as $800 million.

Sam Lubell with Charles Linn, FAIA