Government Offices to Be Anchor
In the New World Trade Center
In two positive signs for the troubled World Trade Center rebuilding, the federal government signed a nonbinding agreement to become an anchor tenant in the Freedom Tower, and separately a Midtown law firm has tentatively agreed to move to the already-rebuilt 7 World Trade Center office building.
New York Gov. George E. Pataki also said that state government agencies would likely take a large block of space in the Freedom Tower. If the state and federal commitments turn into actual leases, it would put that project on stronger financial footing. It would also solidify the fate of the Freedom Tower as a government building, rather than one occupied by private businesses.
The state has "close to one million square feet of space in Lower Manhattan that will be coming up over the course of the next few years, some of which I'm confident will go into the Freedom Tower," Gov. Pataki said.
The Port Authority of New York and New Jersey, which is run by the two state's governors, has agreed to build the tower so long as New York State can find enough government tenants by a September deadline so the project isn't a financial drain on the bi-state agency. The financing plan for the $2 billion tower rests on insurance proceeds and loans guaranteed by long-term government leases. Neither of those sources of money are settled.
Port Authority Chairman Anthony Coscia, who is from New Jersey, said, "We're pleased the governor has taken significant steps to find tenants. And we're hopeful that by September these commitments can be turned into leases that support the viability of the project."
The federal government's tentative commitment is for 600,000 square feet, essentially returning to the amount of space it had in the old Trade Center. The U.S. Customs House -- now part of the Homeland Security Department -- occupied World Trade Center Six, one of the heavily damaged squat buildings next to the Twin Towers that was razed after the attacks.
Likely state government tenants include the Insurance Department, Office of Court Administration and Division of the Lottery. The state's Office of General Services published a request for proposals in March for 395,000 square feet of space to replace a lease that expires in 2007 at 25 Beaver Street, where those agencies currently are housed, blocks from the trade center. Others mentioned as tenants include the state Attorney General's office.
In related news, Darby and Darby, a midtown Manhattan law firm, has signed a "deal sheet" or tentative agreement to move into two floors at 7 World Trade Center, owned by real estate developer Larry Silverstein, according to people familiar with the transaction. Darby would be the first company to move from the increasingly expensive Midtown market to the trade center. A Darby representative couldn't be reached for comment.
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