The race to sell off a portion of the Freedom Tower—officially, One World Trade Center—has kicked into a new gear.
The Port Authority, the New York–New Jersey–controlled bureaucracy that is developing the tower and shopping around an ownership stake, late last month dropped two developers vying to take a piece of the 1,776-foot tower, according to people familiar with the process. Out of the running: Steven Roth’s Vornado Realty Trust and Brookfield Properties, run by CEO Ric Clark.
That leaves four developers standing: Mort Zuckerman, Douglas Durst, Stephen Ross and Gerald Hines, who respectively control Boston Properties, the Durst Organization, the Related Companies and Texas-based Hines Interests.
The skyscraper is on the rise in Lower Manhattan, with a hulk of steel currently more than 200 feet above ground. With symbolism and security guiding its design and purpose, it is surely a money drain for the Port Authority, at least in the short run, and costs more than $3 billion, twice the price of the 2,716-foot Burj Khalifa in Dubai, where labor is cheaper.
Thus the agency, searching for the developers with brokerage Cushman Wakefield, wants to bring in some money—it’s looking for an investment of about $100 million to take a piece of equity—and to install a well-known developer as the public face of the tower.
Of course, this is not the first time the agency has tried to sell off a piece of the tower. Back during the Spitzer administration, Ross was in advanced discussions to put up capital and claim the tower for Related Companies as part of a different financing arrangement, according to people familiar with the discussions at the time. That plan fell apart, and two years later, here we are again.
In a statement, the Port Authority said it is “encouraged by the strong private sector interest” in the tower.