News Corp. and Fox Said to Consider Move to World Trade Center Site

Charles V. Bagli, New York Times

News Corporation and 21st Century Fox, two giant media companies controlled by Rupert Murdoch, are considering building a joint headquarters in a new 88-story skyscraper at the World Trade Center, real estate executives and government officials said this week.

The News Corporation building, which houses The Wall Street Journal and The New York Post, at 1211 Avenue of the Americas. CreditMichael Appleton for The New York Times

The News Corporation building, which houses The Wall Street Journal and The New York Post, at 1211 Avenue of the Americas. CreditMichael Appleton for The New York Times

If a deal is struck, the move by the companies from Midtown Manhattan to a new tower downtown would complete the rebuilding of the office complex destroyed on September 11, 2001. It would also solidify the transformation of Lower Manhattan into a technology and media hub and a lively residential community.

The companies, which include Fox News and The Wall Street Journal, have been in discussions for months with the Port Authority of New York and New Jersey, which owns the site and the developer Larry A. Silverstein, who has the rights to build the fourth and last office tower at the site, known as 2 World Trade Center, according to the real estate executives and government officials, who spoke on the condition of anonymity because the deal had not been

“This move would establish media hegemony in Lower Manhattan,” said Mitchell Moss, a professor of urban planning at New York University. “News Corp. and Fox are in everyone’s living room. It removes any uncertainty that the new trade center would be a major economic engine, and it validates the 15-year effort to rebuild the World Trade Center.”

News Corporation and 21st Century Fox would require a substantial revision to the long-planned 2 World Trade Center, at Vesey and Greenwich Streets, which the British architect Norman Foster designed. The companies want the base of what is now a cruciform-shape tower with a diamond crown to accommodate television studios.

Earlier in the year, Mr. Murdoch’s companies looked and passed on the Related Companies’ Hudson Yards project on the Far West Side of Manhattan. Mr. Murdoch’s companies are now housed at 1211 and 1185 Avenue of the Americas.

The discussions on the trade center are shrouded in a confidentiality agreement, but several executives who have been briefed on the plans say both sides are spending an enormous amount of time and money assessing the feasibility of the project.

Nathaniel Brown, a spokesman for 21st Century Fox, said on Friday that it and News Corporation “are each exploring options for their New York headquarters, and the process is ongoing.”

The two media companies would join Condé Nast, The Daily News, Time Inc., McGraw-Hill, American Media Inc. and MediaMath in moving to an area once known exclusively for its financial institutions.

The tallest tower at the site, the 104-story 1 World Trade Center, opened last year. Mr. Silverstein completed the 72-story 4 World Trade Center in 2013 and is now building 3 World Trade Center, an 80-story tower. But 2 World Trade Center, which is intended to have 3.1 million square feet, remained in the planning stages, without an anchor tenant to get the project off the ground.

Even as the new trade center has taken shape, the surrounding neighborhood in Lower Manhattan has undergone a major transformation. The area, which 20 years ago often looked like a ghost town at the end of the work day, is now home to upscale restaurants, luxury retailers and more than 60,000 residents.

The financial industry, which lent the neighborhood its name, still has a strong presence. The New York Stock Exchange remains on Wall Street. The Federal Reserve Bank is on Liberty Street, and Goldman Sachs is an important downtown firm.

2 WTC's future position on the World Trade Center complex

2 WTC’s future position on the World Trade Center complex

But the industry’s footprint has been shrinking steadily. One Wall Street, the Art Deco home of Irving Trust and Bank of New York Mellon, is being converted into luxury apartments, as are many other older downtown office towers. Chase Manhattan Plaza was sold to a Chinese company.

Time Inc., and its stable of magazines and digital media properties, is moving to the five-building office complex that was once known as the World Financial Center. Merrill Lynch and Nomura, a Japanese financial firm, are gone from the complex, and its owners have renamed it Brookfield Place.

Mr. Murdoch is not unacquainted with life downtown. HarperCollins, the publishing division of News Corporation, is already in Lower Manhattan, at 195 Broadway. In 2013, News Corporation spun off 21st Century Fox, which includes television studios, Fox Entertainment Group and various broadcast units.

The two companies have about 4,000 employees at their offices on Avenue of the Americas.

Yet there are logistical issues at 2 World Trade Center, and the companies have a history of failing to pull the trigger on major real estate moves.

In 2008, News Corporation was a partner and anchor tenant in a bid by the Related Companies to buy the West Side railyards for a 26-acre residential and commercial complex. Related effectively dropped out of the bidding a month before the final selection after a shaky economy led Mr. Murdoch’s company to abandon the deal. Ultimately, Related did gain control of the railyards after the winning bidder refused to sign the deal.

Even earlier, News Corporation negotiated for six months in 1989 with the developer David Solomon to be the anchor tenant for a 42-story tower under construction at the north end of Times Square. The two sides failed to come to terms; Mr. Solomon tumbled into bankruptcy and lost his building.

The talks at the trade center began earlier this year. Initially, Mr. Murdoch’s companies had wanted to gain control of the site from Mr. Silverstein and build a smaller tower designed by their own architect. That proved undoable for various reasons.

The companies are now talking about taking about half of the building — 1.5 million square feet — designed by Mr. Foster, but they still may bring in their own architect for the changes.

Given that the foundation has been built, the two sides are assessing whether the structure can accommodate the changes they want for television studios.

If it proves possible, it is still unclear what kind of subsidy deal News Corporation and 21st Century Fox would want from the Port Authority, the city and the state. Generous sales tax breaks are available downtown, but there are no more tax-free Liberty Bonds, which were used to finance the other office towers at the trade center.

Correction: April 10, 2015 
An earlier version of this article misstated the year that the building at 4 World Trade Center was completed. It was finished in 2013, not last year.

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