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If you build it... Well, will ya? (D-Box/Courtesy Silverstein Properties)
The most recent deal to get the final pieces of the World Trade Center site off the ground was supposed to be, or so the players involved made it seem, the final one. No more handouts, no more delays. But as our colleague Eliot Brown over at the Observerpoints out, this is far from the first deal that has been brokered between the Port Authority and Silverstein Properties. It is in fact the fourth, and it quite possibly has brought the public’s total investment in the private portion of the site—to say nothing of such public expenditures as the $3.2 billion (formerly $2 billion) PATH station—to possibly $2 billion. “While the ultimate public tab may never come to be that high, what is clear is that the amount of public assistance for what is now to be two private World Trade Center towers with 4 million square feet is exceptional, and far more than ever advertised or anticipated when the rebuilding plan was sold to the public,” Brown writes.
This quickly turns into a lose-lose situation:
One development plan is sold to the public with promises of a certain subsidy level and an expected long-term gain from rent. But conditions change, costs increase, the market worsens, and once it seems too late to turn around and scrap a deal, a developer needs more aid, and the public sector is in a tough place to refuse.
The site, of course, is laden with emotion and politics, and the desire to rebuild after a terrorist attack sets the site in a different category than the traditional public-private partnership. But in layering on the assistance at various different points over the past nine years, what is clear from the latest deal is that the total amount of public assistance is extraordinary and tremendous, and one wonders if the current plan would ever have gone forward had the public known its full contribution from the start.
It’s a pretty sad reality for what was supposed to be a grand gesture in the face of tragedy. But pulling back from all that good will and high hopes, with the comfort of hindsight, it becomes clear this was just another development deal in New York City, possibly the granddaddy of them all. Look no further than Atlantic Yards or Columbia or, hell, the original World Trade Center itself to be reminded that this is just the way business gets done in this town. Which only begs the question, “How long until the next bailout?” Say, maybe, once the now indefinitely delayed Foster tower gets going again?