The Business of Ground Zero

But today many landlords—who see Mr. Silverstein’s towers as potential competition that would drive down rents—tend to restrict their grumblings to private forums, and the biggest office brokers in the city are generally conflicted.

Anthony Malkin, grandson of Mr. Wien and an owner of the Empire State Building, is one of the few to publicly criticize the plan today; he took out a set of ads in 2007, with Douglas Durst, Seymour Durst’s son, urging a halt to construction of One World Trade Center.

In fairness to supporters of the government-backed plan for two Silverstein towers, there are no appealing options for financing the redevelopment. Those who have urged the two-tower plan, including the Bloomberg administration, have said the office market is in a tremendously different place than it was a few decades ago, and Manhattan has a very small amount of new, modern office space, particularly downtown.

“Financing commercial buildings is obviously difficult today, but there will continue to be enormous demand for new office space in the long term,” said Andrew Brent, a spokesman for Deputy Mayor Robert Lieber.

But much of the blame for the current imbroglio can be placed on the site’s physical design, a tremendously complex, interdependent Rubik’s Cube that needed everything to rise at once for all of the components—the 9/11 museum, the PATH station, the deliveries roadway—to function.

As the recession scuttled Mr. Silverstein’s plans to finance all three of his towers privately, he opted to take an unyielding stance, demanding that the Port Authority—which was experiencing substantial delays on the site’s infrastructure—back financing on at least two of his buildings. He was left in a position of tremendous leverage, as he had the right to leave his sites fallow pits—he didn’t have the money to do much else—which threatened the site’s functionality as a whole.
Added to this financial mess is the emotion surrounding the site, with the looming threat of a global embarrassment if the redevelopment faces further delay and a portion remains a pit a full decade after the terrorist attacks. This has, understandably, allowed elected officials to obfuscate sound real estate policy with patriotism and a responsibility to rebuild.

Perhaps as a result, whatever criticism there is tends not to have much effect, a lesson learned by Mr. Malkin. “My take-away was that Douglas and I really accomplished about as much as my grandfather and Douglas’ father accomplished when they tried it, which was basically nothing,” Mr. Malkin said of publicly criticizing the plan. “So long as we were prepared to run ads at our cost, people were prepared to return our phone call, but not to any effect.”

The Business of Ground Zero