Construction of several ground zero office towers could be put off for decades because of the failing real estate market, the site's owners said Thursday, citing an analysis that projected one skyscraper might not be built and occupied until 35 years after Sept. 11.
Developer Larry Silverstein and the Port Authority of New York and New Jersey have been talking on and off for months about rewriting a 3-year-old agreement that gives the developer rights to build three out of five towers planned at the Sept. 11, 2001, terror attack site.
Silverstein, unable to obtain financing for all the towers and with only about $1 billion left in insurance money to pay for them, asked the Port Authority last fall to guarantee financing for two of his towers, officials familiar with the negotiations say.
The Port Authority agreed to back one tower already under construction, where the government agency has agreed to move once it's built. Executive Director Chris Ward on Thursday cited the exodus of major financial firms like Merrill Lynch and AIG from downtown Manhattan as a reason to not flood the market with 10 million square feet of office space at the same time - about 2013.
Ward also said that Silverstein was free to build his three towers on his own.
But an analysis prepared for the Port Authority by the Cushman & Wakefield real estate brokerage projected that while two of Silverstein's towers could be built by 2013, a third wouldn't be built until 2030 and fully leased until 2036. A second tower that hasn't been built yet wouldn't be fully leased until 2025, the analysis said.