WTC Redevelopment Efforts Get Boost with Freedom Tower Lease

There has not been a great amount of positive news at the World Trade Center site, but things brightened a bit today. Vantone Industrial Co. has signed a lease at One World Trade Center, also known as the Freedom Tower, which will create the China Center, a 190,800-square-foot business and cultural facility, to be located on portions of the 64th floor and the entire 65th through 69th floors of One World Trade Center. Immediately following the lease signing, China Center provided the Port Authority, the owner of the building, with a $10 million letter of credit. The lease represents a “huge vote of confidence for New York,” said Kathryn Wylde, president & CEO of the Partnership for New York City. She noted that private companies must obtain the Chinese government’s permission to invest overseas, and, during this touch economic time, the approval of Vantone’s lease signals China’s confidence in the city. “This is the future of New York,” Wylde said, who said more companies from China and Asia are determined to expand globally. “We want their Western headquarters to be New York City.” The lease is for 20 years and nine months, commencing when the building is completed in late 2013. Rents will start at $80 per square foot and escalate in subsequent years. China Center also will have the right to lease up to two additional contiguous floors under the same lease terms, an option that expires at the end of 2009. The New York City Investment Fund, which is the economic development arm of the Partnership for New York City, has committed up to $3 million in funding to support the China Center. The Port Authority also has commitments for more than 1 million square feet of leased office space in One World Trade Center from the U.S. General Services Administration and the New York State Office of General Services. Leases for these two public agencies are being finalized. These commitments, coupled with the China Center lease, represent nearly 50 percent of the total office space in the building. Key components of the China Center will include an Executive Business Club; a conference center providing high-tech exhibition and conference facilities for corporate meetings and events; and flexible office space designed to enhance business opportunities and networking opportunities for a variety of small-to-mid-sized Chinese businesses. Tenants will receive access to support services, such as: relocation assistance; real estate services; business and financial support; public relations and investor relations; legal services; networking opportunities; event management and special catering; and personalized travel services. The positive news comes amid reports of continuing turmoil at the World Trade Center site. According to a recent report in the Wall Street Journal, the developer of three other buildings at the site, Silverstein Properties, is asking for financial help on at least two of the three towers from the Port Authority. Silverstein is obliged to pay $79 million a year in ground lease payments to the agency, as a result of his deal in July, 2001 to buy the Twin Towers. If the development of these office buildings stalls, other components of the project could also be hampered. For instance, the $3.2 billion transit hub could be affected, as it depends on the office towers for ventilation and fire exits, according to the Journal report.