Goldman Sachs has reached an agreement in principle with the City, the State, and the Battery Park City Authority to pay $161 million ground rent for its new headquarters building in Battery Park City, according to multiple official sources and a company spokesperson. The firm was originally required to put these funds into an escrow account in return for the right to erect the new building, but was theoretically able to demand that they be returned after the City and State failed to meet a series of deadlines and milestones agreed to in 2005, such as the completion of a new transit hub and the World Trade Center Memorial, which were originally supposed to be finished by Dec. 31, 2009. The most important of these milestones was that the New York Police Department (NYPD) develop and implement a security plan for the World Trade Center complex and surrounding areas by the close of 2009.
The NYPD completed that plan on schedule, in the fourth quarter of last year, but will not be able to “implement” it for several more years because nothing has yet been built at the Trade Center site. For the past six months, says an official source familiar with the discussion, the Bloomberg administration has urged Goldman to accept its good-faith effort to complete the plan as sufficient to justify payment of the $161 million in ground rent. At the end of December, Goldman agreed.
“We’ve always said it’s never been about the money,” Goldman Sachs spokesperson Andrea Raphael said. “The New York City Police Department in particular has done a great job. Releasing the money is a gesture of our good faith and we will continue to work with the city on the outstanding issues to ensure pedestrian safety and accessibility for everyone in the Battery Park City community.”
Although all sides say that a handshake deal has been reached, a formal agreement has not yet been finalized. When that happens (one government source expects it to be in the next month or so), the $161 million that has been sitting in as escrow account since 2005 will be released to the Battery Park City Authority.
- Matthew Fenton
BPC Broadsheet
