In response to a growing controversy over the proposed scale of the World Trade Center site redevelopment, New York City officials have proposed an exchange of ownership of the WTC property for the land at LaGuardia and Kennedy airports. Currently, the Port Authority owns the land at Ground Zero, and the city owns the two New York transportation hubs.
According to reports published late last week, the swap would give city and state officials control of the rebuilding effort at the 16-acre Ground Zero site and eliminate worries about whether revenues from new commercial space at the trade center would satisfy the financial needs of the Port Authority. The Authority previously insisted on rebuilding enough commercial space to continue generating $120 million in lease payments a year. It also pays $3 million per year for the land leases at the two airports under a lease that runs through 2015.
"This is a very interesting proposal which deserves serious examination," Jack Sinagra, chairman of the Port Authority, said in a statement. "In concept, it would be consistent with the Port Authority’s core mission of transportation."
The land swap proposal follows the unveiling of six redevelopment plans that were greeted with criticism by the public and New York City Mayor Michael Bloomberg because of their conformation to the specs of the leaseholder, Silverstein Properties, and the Port Authority.
Larry Silverstein of Silverstein Properties, who took a 99-year lease on the twin towers from the Port Authority in July 2001, also weighed in to support the proposed trade, saying the Port Authority’s ownership of the land sets up a conflict of interest.
For more on the redevelopment plans for Lower Manhattan, see the "Rebuilding New York" cover story in the August issue of National Real Estate Investor.