Can you talk about the process?
The truth is, at the moment, we don’t really know where we are. Obviously, Merrill Lynch has a new chief executive officer who starts here in a couple of weeks—I imagine this is one of his top priorities, to figure out what the long-term space plan is for the company.
And a tougher market could be working in your favor potentially, given that moving to midtown would be the costliest option?
We were confident all along that we had by far the most economical alternatives for Merrill, and that scenario hasn’t changed. If anything, it’s gotten better, but sometimes businesses make decisions not purely based on economics.
Should Merrill leave, it’s going to be a very large chunk of space to fill, right next to four mostly empty towers across the street at the World Trade Center site. How are you approaching that?
There’s obviously been a lot of press over the last several months about what Merrill might or might not do, with the speculation leaning on the Merrill-moving-to-midtown side. I can tell you that the phone actually was ringing a lot, [from] those that are in different industries than Merrill, but also ones that are in the same industry—they were inquiring about whether they could move from midtown to downtown and effectively cut in half their occupancy costs. I like our prospects.
Still, it’s a challenge, is it not?
It’s somewhat of a challenge. Again, I like our cards—we’re happy to own the World Financial Center.
Larry Silverstein—do you think he’d have a tougher time filling his towers than you would filling Merrill’s space?
I guess I would say, if I was given the choice of owning our real estate than the real estate across the street, I’d own our real estate.
What’s the status of your plans to develop a large site on Ninth Avenue just west of Penn Station?
We’re just working through the details on a couple of different alternatives. The site at the moment looks most likely like it will be a two-building office complex, roughly five million rentable square feet, with a grand covered public space in between the two buildings. A variation on that scheme is, we might include a hotel/residential building on the southwest portion of the site.
Would you build the commercial on spec, or would you want an anchor tenant?
The current thinking—the smallest building on the property is about 1.8 million square feet. That’s a very sizable building to do on spec, so most likely we would look to land an office tenant.
In early 2001, you put in a bid for the World Trade Center tower
s, losing out to Larry Silverstein. How would things be different today had you won that?
Thank God I don’t have to think about that.