Lower Manhattan UPDATE
Watching and Waiting
Delays in rebuilding at Ground Zero are testing patience, yet
Downtown’s boosters say the neighborhood’s renaissance is a
foregone conclusion
It seems that no two people can agree on the outlook for Lower
Manhattan. The most optimistic observers maintain that the
World Trade Center area and the Financial District are undergoing a renaissance that could bring Downtown to its rightful position as the most prestigious and exciting part of Manhattan. The
gloomier view is that even if everything gets built—the new World
Trade Center, the various hotel/condo projects, all of it—it’s going to
come on line before the local economy has recovered, and therefore
will take a long time to fill up.
The apparent consensus is that the city’s current economic conditions will start to improve in 2009 and will be all better in 2010, at
which time new space will be more than welcome. The question is,
what will Downtown look like a couple of years from now?
First, the bad news—which of course is not news at all to anyone
who’s been paying attention: None of the major projects ongoing at
Ground Zero are going to be completed on schedule. Indeed, as of
this writing, there is no schedule. (One has been promised for late
September; some observers remain skeptical.)
Tower 1, the Freedom Tower, once expected to be finished by
2012, now has no completion date. The transit hub, scheduled to
open in 2009, is now optimistically slated for 2011, with cost estimates rising from $2.2 billion to more than $3.4 billion. Towers 2,
3 and 4 will probably be completed in 2011 and 2012; no dates
have been set for Tower 5. The Memorial Museum will almost certainly not open in time for the 10th anniversary of the attacks on the
World Trade Center.
Progress is being made, but it’s
slow going. The Freedom Tower is
now about 25 feet above ground;
excavations for Towers 3 and 4 are complete; those for Tower 2 have
begun. So has work on the foundation for the transit hub. The foundation is laid for the Memorial Museum, and actual construction
should begin this fall.
On the street, the overall attitude towards these projects is hopeful, but impatient. Real estate mogul Kent Swig, president of Swig
Equities, suggests that it’s a matter of too many cooks, and that potential diners are frustrated that nothing has yet made it to the table.
By Joseph Dobrian
“The trouble is, you’ve got six entities involved,” Swig explains.
“There’s the State of New York, the State of New Jersey, the Port
Authority of New York and New Jersey, the City of New York, the
Memorial Foundation and the main developer, Larry Silverstein.
It’s not Silverstein who’s at fault here. He’s getting things done. The
others are pointing fingers and talking. The public-private partnership is the greatest asset this project has—but it’s also the greatest drawback.”
Swig asserts that when there’s a public perception that all the entities are working together, confidence in Downtown grows, while
squabbling amongst those six entities tends to slow the market down.
“Look at what happened to Downtown in 2005, the year of the
largest leasing volume in the history of the city,” he says. “In that year,
Lower Manhattan had the least amount of leasing activity in 14 years:
worse than the bad years of 2001-03; worse than the disastrous years
of 1991-93. But the minute all those entities started using the word
‘we,’ in 2006, the market started to pick up again. What needs to happen now is for someone to put out a schedule that will be followed.”
Residential tenants Downtown will put up with a lot, Swig says.
“They just want to be told when the project will be done. They’re sick
of hearing ‘tomorrow, tomorrow.’ The missing piece is credibility: The
parties involved need to realistically tell us when it’s going to happen.”
Silverstein himself, who’s building three towers at Ground Zero
plus a nearby Four Seasons hotel/condo project to be completed in
2011, admits that the entire project is a long way from completion—
but, he insists, it’s proceeding.
“The Port Authority announced some weeks ago that there would
be delays in their parts of the project, and they have to complete the
infrastructure before we can complete our building,” explains Silverstein, chairman and CEO of Silverstein Properties. “We’re helping the authority find ways to reduce costs and speed up the
schedule, and when the whole project is completed we’ll have magnificent, iconic structures.”
Silverstein acknowledges that construction on the World Trade
Center site, in the face of current market conditions, may look to
some like bad timing. However, he insists that once the buildings are
up and ready, the local market will be as well.
