It was never a fair fight. On one side, you had a three-term governor tag-teaming with a quasi-governmental monolith—the PA owns and profits from every major bridge, tunnel, and airport in the New York City metro area, issues its own bonds, and skulks behind a wall of Stalinist bureaucracy—massed to obliterate a Brooklyn-born septuagenarian who had made his bones and his first fortune by buying, burnishing, and flipping distressed office buildings.
The idea that Silverstein and the Port Authority were enemies is exactly wrong. They were in fact allies, tied by their common commercial interests in generating income to pay the lease. Their foes were the civic groups and other art lovers who wanted something other than office space on the site.
The Port-Silverstein alliance, in fact, led to the now-forgotten first plan of July 2002 that would have jammed the site with 10 million square feet of office space. The ludicrous plan was withdrawn amid public outcry, replaced by the international design competition won by Daniel Libeskind. The Port, to accommodate Silverstein, made itself a laughingstock. For Esquire to make that mistake is just strange.
Nor was Pataki a Silverstein foe, as Esquire has it. Pataki tolerated Silverstein as a convenient buffer. Ousting him would have put responsibility for the project right on the governor, where it belonged. Pataki was not interested.
In its pro-Silverstein zeal, Esquire goes as far as to accuse the state of committing “blood libel” against him:
Larry was betraying the memory of the 9/11 dead—and in so doing, helped affirm 9/11’s most costly lesson: From the Hudson to the Tigris—whatever treasure, truth, and blood it costs—wielding national tragedy as a blunt political weapon is hunky-dory.
No direct quotes are offered. But no one was quicker to wave the bloody shirt of 9/11, and the memory of four Silverstein employees killed in the Trade Center that day, than Silverstein and his PR hack, Howard Rubenstein. Silverstein mentions their deaths as motivation at every opportunity.
By late 2005, Mayor Mike Bloomberg can’t stand it any more, and to the Daily News editorial board says for the first time publicly “what many Ground Zero players have whispered privately for months,” according to the News’ Dave Saltonstall: essentially, that New York would be better off if Silverstein’s default were declared and a developer with the means and experience in complex mixed-use development hired.
One could do worse than the real estate giants that the gritty-but-incapable Silverstein beat in 2001: Steve Roth’s Vornado, Mort Zuckerman’s Boston Properties, and the publicly traded giant Brookfield Properties, all many times more experienced in large-scale, mixed-use development and better capitalized than Silverstein’s relatively tiny, closely held company.
Frustration with the lack of progress and other issues triggered a new round of What-about-Larry questions in late 2005 and early 2006, resulting in still more talks with the now lame-duck Pataki administration and a second sweetheart deal: The Port takes off Silverstein’s hands the unrentable Freedom Tower project—while still paying him to build it—and gives him the three best parcels.
Frangos at the Journal put it succinctly:
Despite agreeing to what Mr. Silverstein called ‘real concessions,’ the proposed pact is a big win for the developer and his investors.
The article goes on to note Silverstein’s 2003 equity-reimbursement deal, then summarizes Silverstein’s most recent coup:
Now, he will be relieved of the most difficult to build and worst-located Freedom Tower and gets to keep the three best-located towers.
Combine this with government promises to rent substantial portions of his buildings, and Silverstein would certainly appear to have quite a deal. Other voices offer second-thoughts on entrusting a project of such dimensions to Silverstein. In 2006, New York Magazine’s John Heilemann finally says that Silverstein wanted to make money more than he wanted to act in the public good. “Well, duh,” writes Heilemann. “For more than four years now, in every setting, Silverstein has behaved like a real-estate developer.”
More reporters should have read Peter Slatin’s November 2005 story on his online publication, The Slatin Report, in which he speculated on Silverstein’s negotiating tactics. He quoted a “seasoned downtown observer” as saying that “the more involved Silverstein stays in it, the more it can be perceived that he has a right to major compensation if he has to walk.”
Slatin follows this quote with his own opinion that “Silverstein appears to be maneuvering for a high-cost exit while also making a fully credible show as the archetypal New York developer by squeezing out the last dollar from anyone wandering into his orbit.” This may have been speculation, but if we believe Frangos’s take on the situation, then Slatin was prescient. Silverstein didn’t walk completely, of course, but he received considerable compensation for relinquishing part of the site.
Scott Raab of Esquire must explain Pataki and the Port’s generosity after their “five-year, scorched-earth war.”
Here goes: “In the end, there was no contest: Larry Silverstein kicked Pataki’s ass and the Port Authority’s,” Raab wrote last June.
We don’t know what Esquire was trying to achieve and we don’t care.
But the FT, even if it wants to write the same Silverstein profile, cannot at this late date ignore Silverstein’s role in the sad story of ground zero.
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