http://www.crainsnewyork.com/article/20090824/FREE/908249977
Port Authority hands over last WTC parcel
The move puts an end to the $300,000-per-day penalties the Port Authority was paying Silverstein Properties over delays in delivering land at the World Trade Center site.
By Theresa Agovino
August 24, 2009
The Port Authority of New York and New Jersey on Sunday turned over the last piece of Larry Silverstein’s portion of the World Trade Center Site to the developer, ending the $300,000-a-day in penalties it was paying because of delays in delivering the land.
Under the terms of the lease, Mr. Silverstein must complete all of his three towers by 2014 now that he has received all of the land, or forfeit his towers and parcel.
But that timetable could change. Earlier this month Mr. Silverstein said he was taking the Port into binding arbitration over its failure to deliver the sites on time, which he says has prevented him from securing financing to build his towers. The Port had initially only agreed to finance one tower and then later offered a plan to back a second. However, Mr. Silverstein said the Port’s terms for the second tower would be impossible to meet.
Arbitration is expected to start in October, said sources familiar with the situation.
The Port has paid Mr. Silverstein roughly $125 million in penalties because of a series of delays in turning over the developer’s three parcels, starting back in December 2007. According to Mr. Silverstein, the cumulative delays across the three sites totaled 999 days. Yesterday, the Port delivered the site for Tower Two, which Mr. Silverstein said was 419 days late.
In a statement, Janno Lieber, president of Mr. Silverstein’s World Trade Center Properties, said he was pleased that the site had been turned over but expressed concern over reports that other projects at the site remain behind schedule.
For example, a preliminary report by the Lower Manhattan Construction Command Center found that every major project at the site was unlikely to meet its deadlines. The report said there was only an 80% chance that the Freedom Tower will open by 2018. Ten months ago, the Port Authority said the tower would be finished by the end of 2013.
Likewise, the Port promised that part of the Sept. 11 Memorial would be open by the 10th anniversary of the attacks. The LMCCC report predicted that there was an 80% chance that the memorial’s plaza wouldn’t be finished until May 2013, and that it could be delayed until January 2014.
In a statement, the command center said that the report was only preliminary, and that these dates should not be considered valid until the ongoing review process is completed. But when the report came to light earlier this month, a Port Authority spokesman said that the agency is on track to meet the deadlines the agency laid out last October.
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