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Vornado Chairman Commits a Potentially Costly Faux Pas

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We all have those moments when we accidentally say something we shouldn't, so it's easy to relate to how Vornado chairman Stephen Roth ended up in a bit of a mess with Boston Mayor Thomas M. Menino over some unguarded remarks Roth made at a Columbia University event earlier this month. Unfortunately, Roth's slip of the tongue might end up costing him much more than general embarrassment.

Speaking about urban development in front of a Columbia University audience, Roth let it slip that he let the former Alexander's site in Midtown sit vacant longer than necessary in a bid to get more concessions from New York City government for his eventual project, which became the Bloomberg Tower. In recounting the story, Roth implied waiting a bit too long to start construction might be a smart development tactic, which led some bloggers to speculate he was doing that very thing with the Downtown Crossing project in Boston.

While there's been no response from New York City officials about their feelings on Roth's purported tactics, the suggestion that Roth was holding up the Downtown Crossing development in a ploy to get more money infuriated Mayor Menino, who sent Roth an angry letter berating him for his callousness. Menino is now considering using the power of eminent domain to take the property away from Vornado, according to the New York Observer.

Meanwhile, a writer for The Boston Globe wonders how much of Roth's purported tactic is due to revisionist history.

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Elaine Misonzhnik

Senior associate editor Elaine Misonzhnik has been writing for National Real Estate Investor since June 2006 and has covered commercial real estate for more than 12 years. She first became...
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