Security costs are making it hard for the Port Authority of New York and New Jersey to make a profit on the World Trade Center, built to replace the iconic towers destroyed in the Sept. 11 terrorists attacks almost 18 years ago.
Nearly five years after the 104-floor office tower opened, the World Trade Center complex is still losing money, the Wall Street Journal reported. In part, it’s due to the security costs related to the prevention of future terrorist attacks, according to the story.
The Port Authority, which owns the 16-acre site and manages some of its buildings, recorded a loss of almost $30 million from World Trade Center operations in 2018, not counting depreciation, amortization and bond payments, the WSJ story said, citing the agency’s latest annual report.
While the tower itself is profitable and is 84% leased, operating costs for the surrounding campus, including a park, a transportation hub and car checkpoints, caused the complex to lose money last year. Security this year probably will total $91.4 million, the single biggest operating expense, up from $74.6 million in 2017, the story said.
“New York City showed resilience when it rebuilt the World Trade Center after the Sept. 11, 2001, terrorist attacks, but the project was also supposed to generate profits that could go toward bridges, tunnels and airports,” the story said.
The Port Authority told the Journal it expects the entire complex to become profitable “in the coming years,” the WSJ story said. The original World Trade Center remained unprofitable for years after the twin towers opened in 1973, the Journal said.
“Chris Ward, who served as the Port Authority executive director from 2008 to 2011, said that the agency never had any illusions about the project’s profitability and that the master plan was driven by not just economics but also politics,” the story said.
The office tower that was rebuilt as a symbol of America’s grit and determination to overcome the worst loss of civilian life to terrorism in the nation’s history “wasn’t a building that was built for a rate of return that any office building in New York City could ever expect,” Ward told the Journal.