Legislature Approves New Incentives for Lower Manhattan

NEW YORK CITY-An agreement called a “Lower Manhattan Marshall Plan” by New York State Assembly speaker Sheldon Silver contains incentives to promote economic growth and revitalization in Lower Manhattan. The legislation calls for initiatives to promote Downtown commercial space occupancy, including a $5-per-sf incentive for the first 750,000 sf of commercial space leased anywhere on the World Trade Center site and a $3.80-per-sf incentive for the first 750,000 sf leased at 7 World Trade Center. Developer Larry Silverstein will have to match these incentives.

Additional provisions include to permanently eliminate the Commercial Rent Tax for all Ground Zero tenants and a five-year exemption of the CRT for all of Lower Manhattan and the modification of the Relocation and Employment Assistance Program to make businesses relocating to the area eligible for the tax credits, while the benefit for businesses leaving the area will be at the discretion of the city. Other provisions include sales tax exemptions for such items as office furniture and equipment for businesses leasing at the WTC site and build-out costs at the site and other downtown locations. The agreement also eliminates tax incentives that encourage residential/mixed-use conversion before June 30, 2006.

A separate agreement will dedicate the remaining $3.5-billion Liberty Bond pool for use in Lower Manhattan only with a priority at Ground Zero. Other items listed as priorities by Silver include reconstructing the Church Street corridor and constructing a rail link connecting Lower Manhattan to JFK Airport and the Long Island Rail Road.

Carl Weisbrod, president of the Alliance for Downtown New York, says the agreement will “provide significant economic incentives for the revitalization of Lower Manhattan. Downtown has come a long way since the horrible events of Sept. 11. But the economy remains fragile and these incentives are a key tool for revitalizing the area and fueling economic growth for years to come.”