May 5, 2004

Developer Larry Silverstein has lost the majority of his insurance claims in court regarding the attacks on the World Trade Center.

A Federal Jury in Manhattan Monday ruled that the attacks on the Twin Towers constituted only one attack, and therefore the majority of Silverstein’s insurers only owed one payout.

Therefore Silverstein’s insurance payout, which he had hoped would be as much as $7 billion, will be much closer to the $3.5 billion one attack would have paid. The final payout is pending a final court case late this summer.

Silverstein purchased the lease on the World Trade Center just prior to the 9/11 terrorist attacks. The insurance decision significantly affects his ability to fund developments at Ground Zero, including the Freedom Tower and the other planned office towers on the site. Much of the funding, it appears, will now be privately raised, not paid for by insurance company claims.

The developer admitted his displeasure in a written statement yesterday, but claimed he would continue rebuilding as before: “Of course I am disappointed that the jury did not see things our way with respect to most of the insurers in the WTC coverage. But let me be clear. A defeat in the courtroom is not a defeat for rebuilding. Whatever happens in court, we are determined to rebuild the World Trade Center, under Governor Pataki's leadership and in keeping with the Master Plan.”

Prior to the decision, Lower Manhattan Development Corporation President Kevin Rampe said that the insurance decision would have no impact on building at the Trade Center site. “The plan will not change,” said Rampe, who said if Silverstein lost, he would have to find funding through “traditional sources.”

Sam Lubell