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Rupert Murdoch’s 21st Century Fox and News Corp have bailed on their much-ballyhooed plans to move their headquarters to 2 World Trade Center, the companies revealed on Friday.
The mercurial media mogul is turning his nose up at the $43-million package of sweeteners, financed by the landlord and the public, arranged last month to lure the two media companies from their Midtown offices to become anchor tenants of the final tower of the new World Trade Center complex.
Like many doomed romances, the courtship of Murdoch by developer Larry Silverstein began with such promise.
Last June, the parties signed a non-binding letter of intent for 1.3 million square feet of space in the unbuilt tower, setting the media abuzz. A month later, architectural wunderkind Bjarke Ingels added to the engagement’s glamor with a dazzling new design.
Then in December, the Port Authority ponied up $9 million in subsidies, to go along with $15 million in tax credits from Empire State Development and a $19-million rent discount from Silverstein Properties meant to seal the marriage in a 30-year lease for 1.5-million square feet at 2 WTC.
But on Friday, Murdoch’s New York Post reported that its parent company, News Corp, and 21st Century Fox had gotten cold feet, abandoning Silverstein at the altar.
“We have concluded that a relocation project of this scope could be distracting in the near-term and, given the scale of investment in a relocation of this size, that our resources would be better directed elsewhere,” the company said in a statement to employees, according to the Post.
The media companies’ current lease at their Midtown headquarters runs to 2020, with an option to extend to 2025.
The World Trade Center complex has attracted several other media companies, including Conde Nast, and the News Corp/Fox move had been touted as definitive proof that Downtown had become the new center of New York’s media industry.
More importantly, two companies were also to be the crucial anchor tenants for 2 WTC — the last tower of the new World Trade Center complex that remains unbuilt — unlocking the financing required to complete the rebuilding of the complex after its destruction in the attacks of Sept. 11, 2001.
“Two World Trade Center really is the last piece of the puzzle for our organization. We’ve been at this as long as many of you have — for 14 years. It was always a bit of a question mark because we didn’t have the financing,” Silverstein spokesman Dara McQuillan told Community Board 1 at a meeting in July to unveil Ingels’s new design soon after Fox and News Corp tentatively signed on. “Two World Trade Center couldn’t get building unless we had a tenant. And we needed a big tenant.”
Murdoch’s withdrawal once again throws the future of 2 WTC, and thus the entire project of rebuilding the Port Authority-owned World Trade Center site after 9/11, back into question.
But Silverstein, who stood by his own commitment to the World Trade Center after signing a 99-year lease for the complex just two months before it was destroyed, maintains a steadfast optimism.
“Make no mistake: it won’t be long before we find a great company to anchor 2 World Trade Center,” he said in a statement. “We at Silverstein Properties remain 100 percent committed to successfully completing this historic rebuilding effort.”