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One On 1: Developer Larry Silverstein

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NY1's Budd Mishkin continues his "One On 1" series with a profile of developer Larry Silverstein. Before 9/11, Silverstein was well known in New York real estate circles, but he was not exactly a household name. That has clearly changed in the last five years.

The Larry Silverstein most of New York knows is a real estate developer, one of the most public faces of the struggle to build at Ground Zero, but he's also got a side business that only his friends, family and colleagues see. Would you believe Larry Silverstein, matchmaker? He's got the card to prove it.

"Early on when I found young people in the office and [I was] always asking, ÎAre you single? Seeing anybody?’ I said, ÎHey, give me your name and phone number. Let me see if I can fix you up with somebody.’ And I invariably did that," he says.

But for most of us, Larry Silverstein will always be known as the man whose company leased the Twin Towers seven weeks before 9/11, and is now one of the most important players in the rebuilding at Ground Zero.

He was a prominent developer before all of this, and owner of 7 World Trade Center since 1980. But he says none of that compares to the experience of dealing with so many factions over the last five years.

“The people involved that each represent each government entity, and the differing agendas of these people, the different motivations, it really was a happening, a true happening,” he says. “And how do you prepare for this? I don't know."

To some, Silverstein is a businessman trying to do the type of deal that's never been done before. To others, he is one of the reasons why the process has become bogged down.

He was already hugely successful before all of this. Now he's the subject of media scrutiny and occasionally public scorn. Why would he do it? Who needs the aggravation?

Silverstein says that after September 11th, he had a decision to make, a decision he pondered with his wife Klara.

“We could go off and build another boat and do whatever we want to do - sail around the world and so forth - or we could do something useful with our lives like rebuilding the Trade Center,” he says he told his wife. “But I can't make this decision alone. Whatever you want to do, I'll do. So she said, “You're not going to be happy doing anything else with you life, so let's get on with the rebuilding of the Trade Center.’”

Silverstein quickly began rebuilding the site which now houses his office, 7 World Trade Center. But no one died at 7 World Trade.

The process of building across the street was infinitely more complex, and emotional. And he says a friend forewarned him.

“When things break down, when things go awry, when government screws up, you're going to be the fall guy because you're the easiest person for them to attack," he says.

The vitriol reached its height after negotiations broke down in March, and Silverstein was accused of being greedy.

“It was clearly an indication of the greed involved in the solution, and not really in the public interest, and that was quite disappointing,” Empire State Development Corporation Chair Charles Gargano said at the time.

"If I fired back a response, what would it do? What would it accomplish?” says Silverstein. “If I showed my anger my hostility, my frustration, all of which I felt, would it accomplish anything? Absolutely nothing. Therefore forget the vitriolic, forget the name calling - it doesn't mean a goddamned thing. Let's get back to the table and make the goddamned deal because that's what's important for New Yorkers and that's what's important for this site. Rebuild the Trade Center."

The public bickering died down in late April when an agreement was announced whereby the Port Authority would pay Silverstein to build the Freedom Tower, and then take over the lease when it's done.

Contrary to what his critics say, Silverstein claims 7 World Trade Center is doing quite well getting tenants. But there've been disagreements on that front too.

“When I started moving this building up, I got calls from various government leaders who said, ÎWhy aren’t you filling it? Why aren’t you renting it? Reduce your rent. You’re charging too much.’ I listened to them and said, ÎI appreciate your perspective.’ I'm not sure I used those exact words,” he says. “This is private enterprise, I built this building, I used my resources, now I will get this building leased in a circumstance that is most beneficial to building in an investment that is quite substantial. This is not your money, this is my money.”

But critics charged that Silverstein's approach at Ground Zero should have been different.

“First of all, they had not paid $3.2 billion for the site. Number two, they did not sign the ground lease that I signed that obligated to me to pay $120 million a year to the Port Authority,” he says. “They had not signed these agreements, not signed these obligations. They were giving advice very freely, but it was my obligation, however, to pay the ground rent and to rebuild.”

Silverstein gets away from it all by spending time on his boat with his family, and listening to his beloved classical music.

If someone came to him early on in his life and told him, “You can either be a great real estate developer or a great classical musician,” what would he have chosen?

“The truth of the matter is not what I would have chosen, but what I did choose,” he says. “Obviously here I am as a real estate developer. I’m not sure that I'm so great, but a real estate developer, that's clear."

Perhaps that answer is instructive, for Larry Silverstein's work is about numbers and specifics, not hypotheticals.

Long before his name was synonymous with the World Trade Center, Silverstein was a kid growing up in Bedford Stuyvesant whose father filled the house with classical music.

"He was a fine classical pianist. He loved it. It was an important part of his life,” he says. “He taught my mother how to play the piano, and she taught him how to get married."

He went to the High School of Music and Art, and then NYU. One summer he worked at a camp where he met the woman who would be his wife, Klara. Not that the first summer gave any indication of that.

“She was my boss in the kitchen, and interestingly, nothing has changed,” he says. “But after my experience with her in the kitchen, the camp kitchen, that summer I swore, ÎI never want to see this woman again.’"

It didn't quite work out that way. They got married a few years later, and this year they are celebrating their 50th anniversary.

Silverstein went into his father's business as a leasing broker.

“Fortunately she was earning $3,200 a year as a teacher in the public school system here in New York, so she supported us, literally, for the first three years of our marriage,” he says.

Silverstein eventually switched from being a broker to being an owner, and eventually his career took off. He was successful enough in 1980 to buy the last parcel of land available at the World Trade Center, 7 World Trade Center.

“This is a two million foot building, which is a big building, but it's diminutive compared to those Twin Towers up there rising way above us,” he says. “And I said to myself, ÎWouldn't it be fantastic someday to own those buildings?’”

Work toward that goal intensified in 2000 and 2001. But only a few days before the bid was due, Silverstein was hit by a car while walking at 57th Street and Madison Avenue.

He says he was fortunate in that only his pelvis was seriously damaged. Still, he was on morphine for the pain.

"So I told the doctors, ÎKill the morphine, [I’ve] got to get my people in here.’ So they killed it and he said, ÎIt’s going to hurt.’ I said, ÎI can't help it,’ because you can't think with morphine,” he says.


So they let the morphine run down, the pain was terrible, but I brought everyone together and that's when we framed our best and final bid."

He didn't get it. But the initial winner eventually backed out, and Silverstein's bid finally won. It was announced on July 24, 2001.

Silverstein once dreamed of owning the World Trade Center. He could never have imagined what would transpire after that dream was realized, and the controversy that would ensue.

“Had we been given the opportunity to develop these things without government Involvement, it would have been much easier and we probably would have gotten it done a lot faster,” he says. “However, this is the real world, it’s the world in which we live, it’s property owned by the Port Authority of New York and New Jersey, therefore we’re dealing with them and two governments and the city, so it's been very complex. But nevertheless, here we are."

- Budd Mishkin

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