Volume 18 • Issue 16 | September 09 - 15, 2005

C.B. 1 says Goldman Sachs is selling it short

By Ronda Kaysen

This week Battery Park City residents had their first opportunity, since the city lured Goldman Sachs back Downtown with a sweetened deal, to tell the investment bank what think about its plans to build a new headquarters in their neighborhood.

Community Board 1 members from the Battery Park City neighborhood expressed dismay that no additional amenities will be offered to the community in exchange for a 740-foot tall tower in their midst that is entirely cut off from public access.

The development will now be financed with $1.65 billion in triple, tax-free Liberty Bonds — $650 million more than the original offering — and $150 million in city and state tax credits. Liberty Bonds were established in the wake of 9/11 to assist in the redevelopment of Lower Manhattan.

“We are going to be suffering the consequences of more than 9,000 new citizens. we would like to think that Goldman would reconsider its decision and make a further contribution,” Battery Park City Committee chairperson Linda Belfer told Goldman Sachs representatives at a Tuesday night meeting. The 42-story Goldman Sachs headquarters is expected to house upwards of 9,000 employees.

“I would like to see some of this largess happen for us rather than it be discussed as some long-term theoretical concept,” said C.B. 1 member Barry Skolnick.

Goldman Sachs intends to contribute $3.5 million for a new library — the first for the 9,000-resident community — at another undeveloped Battery Park City development, Site 16/17. The investment bank will also contribute $1 million for a new community center currently under construction in Tribeca, a plaza, reservation-only access to a conference room and a civic facility fee. In exchange for the contributions, the public will have no access to the tower’s lofty atrium.

The contributions to the community have not changed since the original agreement for the site, known as Site 26. Neither has the 2.1 million sq. ft. Pei Cobb Freed design that was presented last fall. What has changed is the public financing.

Last April, Goldman withdrew its pledge to build a $2 billion headquarters at the corner of West and Murray Sts., citing security concerns. In the months since the deal collapsed, plans for a West St. tunnel that would have emptied out in front of the Goldman building have been scrapped and the Freedom Tower has been repositioned and redesigned at the World Trade Center site, resolving two of the most pressing concerns.

Last month, Goldman returned to the fold, accepting a sweetened incentives package from public officials. With the added public financing, Goldman Sachs will probably save $100 million in interest costs over 30 years from the Liberty Bonds, according to the Independent Budget Office, a nonpartisan group.

The investment bank earned $4.55 billion in profits last year.

The firm signed a $161 million, 64-year land lease with the Battery Park City Authority in late August. In a deal that was wrought with secrecy, additional amenities for the public were never brought to the table, according to sources on both sides of the negotiations.

“I’d like you to approach the community not just as another good deal, but as a good neighbor and a good friend,” C.B. 1 member Tom Goodkind told Goldman representatives.

Goldman insists the deal is not a windfall for the company so much as consolation for money lost in the months that the development was stalled. Goldman’s offices are currently scattered throughout Lower Manhattan and the plans are now a year off schedule. Further, “The economics of the deal weren’t even established when we first talked to you,” Timur Galen, director of corporate real estate for Goldman, told committee members.

Construction for the project is expected to begin at the end of the year and will be completed in late 2009 or early 2010.

Although the board did not offer specific amenities it would like to see added to the proposal, they requested Goldman be open to further discussion. “We’d be happy to have ongoing discussions,” Goldman spokesperson Andrea Raphael told Downtown Express later. “As always, we’re willing to listen to any proposals the community has for us.”

At this point the community has little leverage — the Liberty Bonds have already been allocated and the lease signed — and the request might be more a formality than a genuine possibility. “It’s highly unlikely that we’ll get any” additional amenities, C.B. 1 chairperson Julie Menin told Downtown Express after the meeting. “But it’s incumbent upon us — as a community — to at least ask.”

Ronda@DowntownExpress.com


Home

Downtown Express is published by
Community Media LLC.
Downtown Express | 487 Greenwich St., Suite 6A | New York, NY 10013

Phone: 212.242.6162 | Fax: 212.229.2970
Email: news@downtownexpress.com


Written permission of the publisher
must be obtainedbefore any of the contents
of this newspaper, in whole or in part,
can be reproduced or redistributed.