Ground Zero developer Larry Silverstein warned yesterday that he will ditch stalled talks with the Port Authority over rebuilding the World Trade Center and will take the case to arbitration if the two sides can’t reach a deal within two weeks.
The move came almost three weeks after a deadline Mayor Bloomberg set for the two sides to resolve their differences — prompting fear that the redevelopment could grind to a halt.
In a letter announcing his decision to seek arbitration, Silverstein accused the agency of falling behind on its binding schedule for finishing several megaprojects at the site, including the transit hub.
“Today’s action is designed to inject a renewed sense of urgency to these discussions and, should those discussions fail, to take the matter to an impartial panel of experts as early as this month,” Silverstein said.
But the biggest hitch in the talks has been over how far the PA will go to backstop financing for Silverstein’s office towers. Silverstein is allowed to build three towers under his lease with the agency.
Silverstein wants the PA to provide financial guarantees for at least two towers, while he delays plans to build the third tower. But the authority will help with only one, preferring to build temporary retail buildings in place of the other two towers.
“It’s unfortunate [Silverstein] is walking away from the negotiating table simply because the public has been unwilling to sacrifice critical transportation projects to subsidize private speculative office space,” said PA Executive Director Chris Ward.
Ward insisted that the agency is meeting all its obligations under a 2006 agreement with the developer, “and we look forward to a quick arbitration decision should Mr. Silverstein continue down this legal path.”
Bloomberg yesterday suggested that it was the PA that hasn’t done enough. And he disputed the agency’s claim that it would have to cut key transportation projects if it backs more financing for Silverstein.
“Pitting those projects against the development of the World Trade Center site creates a false choice,” Bloomberg said.
“The reality is, the Port Authority owns and controls and is financially tied to 16 acres in lower Manhattan, the development of which this city and the entire nation demand move forward,” Bloomberg said.
Before Silverstein can go to the three-member arbitration panel, he and the PA have to hold one last round of high-level talks within the next 10 business days.