JP Morgan Chase to build WTC tower in $300 mn deal

JP Morgan Chase to build WTC tower in $300 mn deal
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First Published: Thu, Jun 14 2007. 11 24 AM IST
Updated: Thu, Jun 14 2007. 11 24 AM IST
New York: JP Morgan Chase and Co. has struck a deal with the World Trade Center site’s owner to build and move into one of five planned office towers at ground zero, with a hefty package of state and city incentives, three people familiar with the deal said.
JP Morgan, one of the largest US banks, will pay $300 million to the Port Authority of New York and Jersey for rights to build a 40-plus story tower for more than 6,000 employees, the people told The Associated Press on 13 June.
They spoke on condition of anonymity because they were not authorized to publicly discuss the deal, which was to be announced on 14 June morning by Gov. Eliot Spitzer.
The bank will receive a 90-year lease for the building, which is expected to open in the next five years, they said.
The Port Authority and the bank had long ago agreed to make JP Morgan the first private company to occupy office space at ground zero, but negotiations had gone on for months between the bank and state and city officials over tax incentives and other perks before it agreed to move in, officials have said. At one point, the bank suggested it would leave New York City for Connecticut or New Jersey if an acceptable deal couldn’t be agreed upon.
A year ago, the Port Authority took over development of this fifth tower and the 1,776-foot (541-metre) Freedom Tower _ now under construction _ from private developer Larry Silverstein. But after Spitzer took office, the agency has explored the sale of one or both towers to the private sector.
JP Morgan will build its tower on the spot where a vacant skyscraper heavily damaged in the 11 September 2001, terrorist attacks now sits, the people familiar with the deal said. The former Deutsche Bank building, plagued by contamination, the discovery of human remains and a recent construction accident, is being taken down floor by floor. Officials have said it will be completely removed by the end of this year.
The 1.3-million-square foot (120,000 sq. metre) tower will include seven wider, cantilevered trading floors; community officials had objected to the design, saying it would cast shadows over the neighbourhood and on the spot where a Greek Orthodox church plans to rebuild.
JP Morgan would relocate thousands of its investment banking employees from its main midtown location and from several downtown locations, the people familiar with the deal said.
The incentives the bank received to move included incentives on taxes and on its power supply, one of the people said.
The tower is the last planned to replace more than 10 million square feet (930,000 sq. meters) of office space destroyed in the attacks. The Freedom Tower is expected to open in 2011, and three others towers to be built by Silverstein are expected to open between 2011 and 2013.
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First Published: Thu, Jun 14 2007. 11 24 AM IST