Silverstein Says 2004 WTC Plans Must Stand
Primarily blaming symptoms from the recession, the Daily News reported that Port Authority of New York and New Jersey wants to do away with three skyscrapers at the site by shrinking Towers 2 and 3 to four or five-floor stumps, suited more for retail than office.
But sources familiar with Port Authority goings-on tell GlobeSt.com that the information in the Daily News story has been in the public domain for weeks, if not months. They say that the Port Authority's position is that Silverstein's Tower 4 should be built while 2 and 3 shouldn't move up to skyscraper status until there's a market to handle the office space Downtown
Bloomberg Calls Summit at WTC; PA wants Scaled down Project
EXCERPT
A spokesman for Bloomberg tells GlobeSt.com that he wants to help break the current impasse. "He wants to make sure they're talking," says the spokesman. "The mayor is a firm believer that Lower Manhattan is going to come back and we need to invest, and there are billions of dollars being invested now downtown, but, he wants to make sure we continue to see that," says the spokesperson.
Drawing on history, Silver told the Downtown Lower Manhattan Association breakfast that former New York Governor Nelson Rockefeller, along with brother David, and the Downtown Association, led the effort to build the original World Trade Center even though demand for office space in Manhattan was weak.
As Angus K. Gillespie's book titled Twin Towers: Life of New York City's World Trade Center points out, as plans for the site became more clear in the 1960's, private real estate developers and members of the Real Estate Board of New York raised concerns about the 'much subsidized' office space going on an open market that had a glut of vacancies.
Trouble with TALF?
According to analysis compiled by REEcon, the Fed anticipates an increase in securitization and a corresponding increase in loan origination activity, which in turn will enhance lenders' capacity to refinance maturing mortgages, originate new mortgages and support the specific financing needs of investors seeking to acquire properties in distressed sales. More simply, "it's drawing in private capital from a variety of sectors which theoretically bring in all this money that's sitting on the sidelines to purchase these securities and start lending again," Clifton Rodgers, SVP at industry group the Real Estate Roundtable, tells GlobeSt.com.
Pleas for increased liquidity have been coming in loud and clear from the commercial real estate community for several months now as banks, hard hit by the economic downturn, have virtually frozen lending. According to the Fed's Senior Loan Officer Opinion Survey for April, 66% of domestic banks reported tightening commercial real estate lending standards in the first calendar quarter.
Dimming hopes of future relaxing of standards is a growing lack of faith by banks in the quality of commercial mortgage quality. Standard & Poor's recently placed $100 billion of CMBS issued from 2004 to 2008 on negative watch. Fitch Ratings followed suit with $18 billion of CMBS issued between 2006 and 2008. "We have numbers showing that more than 90% of domestic banks think the commercial mortgage quality is going to deteriorate, with 26% of those saying it's going to deteriorate substantially," says Chandan.
Raising the cash flow alarm volume higher, the RER says that over the next few years, the commercial real estate industry faces a liquidity crisis of mammoth proportions. Of the $6.7 trillion of assets compromising the greater commercial real estate market, around $3.5 trillion is debt. Around $10.7 billion worth of CMBS loans are currently delinquent or have defaulted, according to data from the Commercial Mortgage Securities Assoc.
NYC MTA Doomsday Near: Possible Subway Shutdowns in Late Evenings
Fallout from what the MTA calls its "doomsday" plan has begun to spur outrage among city residents. On Tuesday afternoon, transit advocates came together with concerned citizens in Manhattan's Union Square, raising their voices against the proposed cuts. One speaker, 76-year-old resident Carl Van Putten of Hunts Point, shouted "where I live, we're not talking about inconvenience, we're talking about survival." Speakers at the event, largely organized on social networking site Facebook, sought to persuade attendees that New York City's economic backbone is its transit system and without it, the entire city suffers unimaginable trauma.
"I think it's a big myth that's been around for around 50 years that New York is somehow not a mass transit town," Wiley Norvell, communications director for the group Transportation Alternatives, told GlobeSt.com as trains rumbled underneath during another rush hour at the Union Square subway hub.
According to the MTA, a plethora of service cuts will be phased in over the next few weeks and months. The cuts began Thursday, as the traditional seasonal Long Island Rail Road service to Belmont Park was eliminated. But perhaps the true reality of the crisis will begin to settle in on May 31--when fare hikes of up to 29% are set to start on the subways and buses, with LIRR and Metro-North following suit the next day.
Then, June 28, train service cuts begin on a set of subway lines that reads like an elementary school chalkboard. The A, D, E F G N, Q and R lines will all see significant service reductions that day. Meanwhile, a list over two pages long details bus routes that will be either sharply reduced or eliminated entirely cutting off entire neighborhoods from the transit network.
New York City Officials Introduce 'Green' Mandates: Details to be Ironed Out
Contained in the proposals announced by Mayor Michael Bloomberg on Wednesday are mandates that require older buildings to invest in necessary technology and infrastructure that would increase energy efficiency and reduce the city's carbon footprint. New York City's buildings are responsible for 80% of its carbon emissions. The investments could prove costly, but promise tremendous savings in power bills for thousands of properties.
In a release, Bloomberg says his plan "will significantly improve economic competitiveness, put thousands of New Yorkers to work in green jobs, and do more to shrink our own direct impact on global warming than any other actions imaginable." Speaking to the perilous economic times, Mike Fishman, president of the Service Employees International Union's Local 32BJ, the largest private sector union in New York, says in a statement that the initiative would "protect the environment, boost the real estate industry and get workers the training they need to get ahead."
Owners and industry groups agree that the city's initiative is bold, but worry that it could prove intrusive. There are worries that a "one size fits all" approach by government may not prove effective in a city of such wide diversity within its building stock. "In a city with buildings as complex and diverse as New York City, each building's situation is unique and the extent to which it can perform energy upgrades is best evaluated and acted upon by the owner and manager," says a statement from the Building Owners and Managers Association's New York chapter.
Most Constituents in Bridge Toll Opponent Districts: Take Public Transit
Apparently, the biggest point of contention in the Ravitch Plan has been a proposal to charge automobiles crossing the East and Harlem rivers to come into Manhattan. That proposal has met stiff opposition from a group of state Senators, primarily Karl Krueger of Brooklyn's district 27, Pedro Espada from the Bronx's district 33 and Rueben Diaz of the Bronx's district 32.
Even a plan that included lower bridge toll fees, part of a compromised version of the Ravitch Plan proposed by Assembly speaker Sheldon Silver was not acceptable to toll opponents. As New York Building Congress president Richard Anderson told GlobeSt.com in March, "it seems clear, the state senate is being driven by avoidance of Harlem River and East River tolls."
Interestingly, the number of residents who drive to work in the districts represented by opponents to the Ravitch Plan are tally almost 2-to-1 public transit users. In fact, according to RPA data, of the 100,529 residents who commute to work in Krueger's district, 44,534 drive to work while 55,995 take public transit.
Similarly, of the 82,015 commuters in Diaz's district, 22,936 drive daily while 50,906 take the subway and/or bus. In Espada's district, 77,284 commute daily. Of those, 54,348 take public transit while only 22,936 drive a car. Drivers did slightly outnumber transit takers among Brooklyn district 26 and Bronx district 32 residents who earn more than $100,000 per year.
D.O.E. Kicks off new Public/Private Green Building Initiative
Despite increasingly sour times in the market, 18 representatives from some of the nation's largest commercial real estate companies took part in the event. "You give evidence to this being the right time for this initiative by looking at who was here," Richard D. Purtell, chair and CEO at BOMA tells GlobeSt.com. Purtell, also portfolio manager at Grubb & Ellis, stresses that "this is the time to do this: right now and not wait."
Adds Diane Vrkic, COO of global energy sustainability services at Jones Lang LaSalle, "There could be a lot of growth around these alliances. It seemed as through all the different individuals here, who came to exchange ideas, seemed to benefit from these exchanges."
linkChina's Vantone Signs 20 yr Lease at 1-World Trade Center
The deal paves the way for a Vantone unit, China Center New York LLC, to build out a business and cultural facility that will occupy portions of the 64th floor as well as the entire 65th through 69th floors of the 102-story tower now rising at Ground Zero. The new facility will serve as a hub for Chinese firms developing US operations, as well as US companies looking to do business in China or expand ongoing operations.
Contrary to widely reported name changes, Port Authority spokesperson Steve Coleman confirmed to Globest.com, that One World Trade Center still incorporate 'Freedom Tower' as the second half of its name.
Cal Pension Funds seek to lead Lawsuits against Bank of America
The California pension funds--which together own 21 million Bank of America shares, and both of which are active in commercial real estate nationwide--join eight other shareholder lawsuits filed against the Charlotte, NC bank. CalPERS says filing for lead plaintiff enables lawsuits to be consolidated and managed effectively.
Geoffrey Miller, New York University law professor, tells GlobeSt.com that CalPERS frequently acts as a lead plaintiff because "under the governing statute it is quite often the party with the largest financial stake in the litigation, and because it has a bit of an activist stance towards managerial issues."
In a statement, CalPERS board president Rob Feckner says "shareowners did not have complete or accurate information prior to approving the merger and the failure of Bank of America to provide it sent the stock price down dramatically," adding that bonuses paid to Merrill executives were not disclosed to shareholders prior to the merger which compounded the harm done."
Miller tells GlobeSt.com that cases alleging false statements in proxy information sent to shareholders in connection to votes on mergers are common, but the nation's financial crisis issue puts a special spin on this one. "Under normal conditions, this could be a pretty strong case, but these are not normal times," he says. "The courts are sensitive about putting the banks under more stress."
Further evidence of frustration with BofA arose this past Monday when a Houston investment bank, Finger Interests Number One Ltd., filed a notice of exempt solicitation with the Securities and Exchange Commission that urges BofA shareholders to vote against re-electing three bank board members including current chair and CEO Kenneth Lewis at their April 27 meeting. Finger's group also filed a shareholder lawsuit back in January after BofA revealed deeper losses by Merrill.
Finger's 1.1-million BofA shares extend back to the 1996 sale of Jerry Finger's Charter Bancshares to NationsBank, which was later acquired by Bank of America. Over the past year, the value of Finger's' BofA shares fell from $39.6 million to $6.8 million.
Nation's Crumbling Infrastructure and the Stimulus (Link to full text @ RENY)
Developer Procida's 100-day Plan to Distribute Capital Locally (GLOBEST)
excerpt:
He argues that instead of funneling billions of dollars into the nation's largest banks, the federal government should deploy $100 million, each, to 100 local investment managers
"Time is the key to the plan," Procida tells GlobeSt.com. "If the government had told the banks they had 100 days to deploy the capital they were given, you and I wouldn't even be talking now."
But Procida is talking, and he says he has been attempting to capture the attention of policy makers while hoping to further inject his 100-day plan into the national conversation. Procida says he began writing the Obama transition team last Nov. 25, when he introduced himself and his plan. He stressed an emphasis on localization and a return to banking and business fundamentals. Nine days later, on Dec. 4, Procida wrote again.
also:
Interestingly, on February 4, the non-partisan research group--the Center for Responsive Poitics in Washington--reported that that 161 companies approved for TARP money gave $37.5 million to federal candidates, parties and committees in the 2007-2008 election cycle. According to the group's report, the companies giving the most to fund lawmakers campaigns and spending the most on lobbying efforts were also those that received the most TARP money.
LINK TO FULL STORY AT GLOBEST.COM
Touting Infrastructure: Harry S Dent said this Is no Ordinary Downturn
He predicted that the current administration will put up around $3 trillion to $4 trillion in stimulus to try breaking the current downturn. But Dent said he sees the country as rounding the bottom of the crisis and over the next year and a half, the economy will have what he called a "choppy, wimpy bounce."
"We have a downturn that will not be inflationary," and instead "will be deflationary," he said. Tossing humor into the pain-filled punch, Dent said, "this much stimulus is like taking a whole bottle of Viagra and not having anything happen."
Moody's Economist Zandi say's America headed for worst downturn Since Depression (GlobeSt.com)
Link to Full story at GlobeSt.com
excerpt:
"We're going to suffer the worst downturn since the great depression," said Zandi, chief economist at Moody's Economy.com.
A year ago, Zandi, along with a few other noted economists, said the job market was operating at stall speed. In a wire report that appeared in the Dallas Morning News, Zandi forewarned ''either something is going to revive the economy quickly or we're going to get into an unraveling, vicious cycle of declining spending and even weaker job growth."
Fast forward 12 months to the ULI breakfast in Midtown, where Zandi, marveling at how rapidly his earlier prediction came true, said that in his 25 years as an economist, "it's about as bad as I've ever seen it." Attempting to lay blame, Zandi said house prices roughly doubled in the first half of the decade, then the process of mortgage securitization, the process of global investor dollars and turning those dollars into mortgages of US homeowners was all fundamentally flawed.
"No one in this process had the responsibility of making sure that the loans being made were good loans," he said. Zandi said one of the hallmarks of this particular recession is over-levered consumers who are struggling to manage debt loads and record delinquencies.
NYC: 'No 70's, 80's reruns
"Look at the quality of life afforded by a cleaner, safer city," says James Lansill, senior managing director at Corcoran Sunshine Realty. He's referring to the transformation of New York City, once perceived as simply crowded, foreboding and dangerous, into what might be appropriately seen as the nation's urban crown jewel.
While there is no sociological consensus on what spurred that transformation, the timeline of crime that peaked during the crack cocaine epidemic of the 1980s indicates that marked dips can be traced to the years after 1993, when the nation and city began a period of economic resurgence.











