Boston Properties, Durst, Related Said to Compete for Trade Center Stake
Boston Properties Inc., the Durst Organization Inc. and Related Cos. are the finalists competing to invest in and manage One World Trade Center, said people familiar with the talks.
Boston Properties Chief Executive Officer Mortimer Zuckerman and Durst spokesman Jordan Barowitz confirmed their companies are in the running. Related’s participation was confirmed by a person at the company who is familiar with the talks and by an official at Port Authority of New York and New Jersey with knowledge of the competition, both of whom asked that their names be withheld.
The Port Authority, which owns the project site, will choose a partner by the end of May, said Christopher Ward, the agency’s executive director. The authority seeks an investment of at least $100 million in the office tower at the site of the Sept. 11, 2001, terrorist attack.
“It is an amount of money that we think puts their skin in the game, which motivates them to be the best and most- aggressive developer, tenant negotiator and operator of that building,” Ward told reporters after speaking at a breakfast sponsored by Crain’s New York Business magazine.
“There are some projects that you do, not just to maximize the financial return, but also to establish another layer of credibility,” Zuckerman said today during a conference call on the company’s first-quarter earnings report. “It is a project of incredible cost, and will be an incredible icon for the city of New York.”
‘Dominant Building Downtown’
The $3 billion World Trade Center project “is going to be the dominant building downtown, both for the city but particularly for international tenants,” said Zuckerman, whose Boston-based company is the largest U.S. real-estate investment trust specializing in office space. “We will have a very, very limited investment that will be less than 4 percent of that total cost.”
Zuckerman’s company holds properties in Boston, midtown Manhattan, Washington and San Francisco. Related is a New York- based developer that owns assets valued at more than $12 billion, according to its Web site. Office towers built by Durst in its headquarters city of New York contain more than 9 million square feet of space, according to a statement on its Web site.
One World Trade Center, formerly known as the Freedom Tower and planned as the Western Hemisphere’s tallest skyscraper, would add 2.6 million square feet to the office space market upon its completion, scheduled for 2013.
Marketing, Management Role
The financial investment has less importance to the agency than the role the developer will play in marketing the building, servicing tenants and managing its upkeep, Ward said.
“As the tallest skyscraper in the United States, it’s going to have an iconic link to the rest of the world, so that hopefully it will be positioned to attract a variety of foreign tenants,” Ward said.
He intends to meet with each finalist this week, he said.
The authority eliminated Vornado Realty Trust, Brookfield Properties Corp. and Hines Interests, said the agency official familiar with the talks and who asked that his name be withheld.
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