Digging out of the W.T.C. hole
Will the World Trade Center be rebuilt in our lifetimes? For the first time since 9/11, the best answer seems to be “it depends.” Actuarily, a young or middle-aged person still stands a good chance to live to see this increasingly elusive day, but this week it came out that it could be two or three decades away.
There is a lot of bad news and it looks like we’re in for yet another drawn-out fight between the site’s owner, the Port Authority, and its developer, Silverstein Properties, but if both sides can focus on achievable goals, it should be possible to reach a better outcome within the next five years.
What can we get at the W.T.C. by 2014? We think a completed memorial and museum, a train station hub, a large retail complex, and two completed office towers are all possible within that time frame. That’s nothing to be too proud of after 13 years, but it would be a lot better result than many expect in the face of the current economic crisis. Perhaps most importantly, it would mean the site would no longer look like a hole in the ground. In all likelihood, it would also mean millions of tourists a year would be visiting Lower Manhattan to see the memorial, and residents and commuters would have a vastly improved transportation system and shopping options.
This week rebuilding sources said the Port is expecting construction delays on some of the office towers to stretch into the ‘20s and ‘30s. There is no money available to build 10 million square feet of office space and even if there were, there is no demand for it. It is possible that demand will return someday but whether that takes years or decades is anyone’s guess.
It has taken billions of dollars in tax-free Liberty Bonds and about 2 million square feet of government office lease pledges to get to this point, and still more government help would be needed to fully rebuild the site now. It’s time to let the market dictate the rest of the office development, however long it takes.
In the meanwhile, construction is underway at One and Four W.T.C. and that should continue. The W.T.C. had the most profitable mall per square foot in the country and there is a clear demand from residents and Financial District workers for better retail. The Port has suggested building retail podiums at some of the empty tower sites and that would be infinitely better than leaving holes in the ground. The underground work needed for the retail also supports the memorial and train station and needs to proceed anyway.
The complex agreement between Silverstein and the Port clearly needs to be renegotiated again and it will not be easy to come up with a fair resolution, but this cannot stand in the way of the continued construction of the towers and the beginning of the retail foundation work. We hope there’s demand someday to build Towers 2 and 3 too, but before that happens, there will be high-paying government tenants in Towers 1 and 4 that hopefully will be displaced by private firms, and a vacant Tower 5 site that could be built if the market demands it.
As John Maynard Keynes famously said “in the long run we’re all dead.” Let’s work for a better short run.