Liu Rips Marriott Times Square Deal

New York City Comptroller John Liu on Tuesday called on Mayor Michael Bloomberg and the city's Economic Development Corporation to renegotiate a lease agreement with the Marriott Marquis Hotel that he said could cost taxpayers at least $345 million.

"This is one of worst deals since Manhattan was sold for $24," Liu said in a statement. "The EDC betrayed its fiduciary responsibility to act in taxpayers' interest when it recommended this sweetheart deal to the city in 1998. The clock is ticking — the lease set to expire in less than four years would let the Marriott Marquis purchase one of the hottest pieces of New York real estate for a fire-sale price of $20 million — that's 10 cents on the dollar compared to its value today."

The Marriott Marquis, central to the transition of Times Square, was built on city land under a 1982 agreement. In 1998, the EDC encouraged the administration of Mayor Rudolph Giuliani to rewrite the terms and shorten the life of the 75-year lease by 40 years.

The new lease drastically cut the hotel's rent payments and allows the Marriott Marquis to buy a large corner of the Theater District "for a song," when the lease expires in 2017 instead of 2057, Liu charged.

Liu, a probable candidate for mayor this year, said losses to taxpayers amount to $173.1 million in a purchase price below market value, and $171.8 million in rent forgiveness.

"The comptroller's audit, which analyzes an agreement reached 15 years ago in the Giuliani administration, fails to measure the significant impact the Marriott Marquis has had on the Times Square area and New York City overall," the EDC said in a e-mailed response. "This renaissance is celebrated as one of the greatest urban economic development achievements in history, and it didn't happen by accident or without encouraging private investment."

A message was left with Bloomberg's office seeking comment.