Ground Zero Gridlock

A certain combed-over, pompous real-estate mogul enjoys most of the media attention reserved for New York's real-estate industry, but Larry Silverstein is the real King of the Landlords. With 20 million square feet of property under his control pre-9/11, he was unrivaled, yet surprisingly unknown to the public. He still lacks Trump's deviant media-lust, but, unfortunately, his newfound infamy will be with us long after the WTC site has been rebuilt. Whenever that project finally gets moving.

Silverstein's World Trade Center folly began in 1980 with the purchase of the last undeveloped WTC parcel and the subsequent development of the 47-story 7 World Trade Center Building (more on this building later). For most, especially those in their 70s, owning dozens of high-rise buildings would be enough; they might even consider retirement. But Silverstein set his sights 110 stories high.

In 2001, Silverstein Properties along with Westfield America won a 99-year lease for most of the WTC complex with a $3.2 billion dollar bid. The deal, a New York City real-estate record, was finalized only seven weeks before 9/11. Silverstein would then take out a record insurance policy. If the timing doesn't seem suspicious, remember that men have done much worse to gain much less.

Immediately following 9/11, Silverstein was a media darling and recipient of the world's sympathy. An aging real-estate king finally reaches the pinnacle of his career when an unforeseen national tragedy brings him to his knees-cheek to cheek with the unwashed masses. At first, his only opposition was a handful of conspiracy theorists that pointed to a slip he made during a 2002 PBS documentary titled America Rebuilds. While talking with a fire commander after 7 World Trade Center caught on fire (allegedly from falling debris), Silverstein said he told him to "pull" the building. In the world of controlled demolition, "pull" means to begin demolition. Silverstein later explained that he meant pull out the fire personell. There's no denying that the collapse, even more so than the Twin Towers, appeared systematic. Then again, we've never seen a jumbo jet plow into a skyscraper before. Despite the testimonies of several noted architiects, there remains a nagging disbelief that 7 World Trade Center could have fallen so easily when other buildings that were closer and suffered more damage stood firm. According to experts, fires created by diesel fuel or falling debris cannot create temperatures hot enough to melt the steel support structures. The truth about this still-vague aspect of 9/11 may forever remain a mystery.

Silverstein's popularity with the rest of the public (i.e. not just those wacky conspiracy theorists) began to wane when it was time to collect on that record insurance deal. Using the terms of an obscure clause in his insurance policy, Silverstein demanded the payout be doubled because two plane collisions meant two separate attacks. Eventually he settled for $5 billion, $1.8 billion more than his investment.

It's easy to dismiss Silverstein's actions from a business perspective. Most corporate types would have followed Silverstein's example. So when it came time to rebuild Ground Zero it should have come as no surprise that Silverstein would again fight for the largest piece of the pie. But this time he lost the majority of his supporters with his attempted bullying of the Port Authority (owner of the site) and the entire city.

Silverstein's new found bravado is compelling, considering most analysts feel his plans are not financially feasible. Silverstein wants to rebuild four towers for purely commercial purposes. Any residential property, he says, would break his insurance requirements. Meanwhile, Bloomberg claims Silverstein will run out of money after only two buildings have been completed. Bloomberg's opinion only matters because he has control over $1.7 billion in Liberty Bonds authorized by Congress, money he will withhold until he's satisfied with the plans. New estimates place the WTC rebuilding process at $10 billion, and those Liberty Bonds would cover a nice chunk of the cost. Negotiations last month included various proposals in which the Port Authority would take over certain buildings in exchange for cash payouts and future leasing, but they were called off due to what the Port Authority described as Silverstein's "outrageous" and "greedy" demands.

Rumors have circulated about the use of eminent domain, but even if the King were to be ousted, Silverstein would continue to fight until the bitter end. In this case, it would mean a vicious-court battle the likes of which the city has never seen. The ruling would be absent of victory as the process would surely take years and only add to New York's wounds.