At that time I was working for the New York City Comptroller as Chief Economist and the first I knew of the destruction was the large number of police and fire vehicles headed south.
I heard the sirens as I was leaving for the airport on Friday evening for a vacation with my family and parents-in-law in Florida.
Six people died in the explosion and another thousand suffered injuries. When I got to Florida I was contacted about estimating the economic impact. I returned early, on Sunday, and started making estimates based on reports that were coming in on the damage to the cars in the parking lot, insurance claims, the damage to the building, the impact on security and the overall impact on the outlook for the New York City economy and tax revenues.
Meanwhile, investigators at the bomb scene found a section of a van frame that had been at the center of the blast, with the vehicle identification number still legible. Detectives interviewed the Ryder Rental Agency in Jersey City, which gave the renter as Mohammed Salaamed, who reported it stolen on February 25. Someone named Salameh in the FBI database as a potential terrorist. The renter returned to Ryder to get back his $400 deposit and when he came to collect it, the FBI was waiting to arrest him. His notes led them two other suspects.
One of the terrorists was found to have bought hydrogen tanks from AGL Welding Supply in New Jersey and three tanks marked “AGL Welding” were found at the site of the bomb.
The owner of a storage facility in Jersey City reported he had seen four men loading a Ryder van on February 25. Sure enough, investigators found enough chemicals there, including nitroglycerin, to make another bomb, along with videotapes on bomb-making that led to a fourth suspect. Each of the men was sentenced to 240 years in prison.
These terrorists did not bring down the World Trade Center because the force of the bomb was taken by the first of the steel pillars, protecting the next in line. Repairs were expensive but the buildings stood.
A World Trade Center Property Risk Report, prepared for Silverstein Properties in anticipation of the WTC lease (Source: www.nistreview.org, FOIA request.), asserts (p. 29) that the Maximum Forseeable Loss from another terrorist act would be five weeks' rent:
The 1993 terrorist bombing of the WTC resulted in a maximum forseeable property loss. This event shut Tower 1 down for 6 weeks and Tower 2 for 4 weeks. The explosion, that occurred in the garage area of B-2, caused portions of the Plaza and two Subgrade floors (about 4 bays by 4 bays) to collapse on to the B-6 level damaging mechanical and electrical equipment of the Chiller Plant. As large a blast as it was, there was negligible structural damage done to structural members. Damage was limited to the replacement of these concrete floors, repairing spalled concrete where reinforcing steel had been exposed and rebuilding non-bearing walls.On the subject of the possibility of an aircraft striking one of the towers, the scenario was considered "highly unlikely".
The magnitude of this type of MFL loss can be estimated at 5 weeks rent or 1/10th of the $364m annual rent or $35m. Plus property damage to the building from the 1993 incident is estimated to be $175m and equipment damage of $120m or a total of $330m.
In 1946 a military aircraft struck the Empire State Building. Since that time the manner in which aircraft are "controlled" has dramatically changed. In the event [of] such an unlikely occurrence, what might result? The structural designers of the towers have publicly stated that in their opinion that either of the Towers could with stand such an impact from a large modern passenger aircraft.On September 11, 2001, the World Trade Center was again attacked. The damage was approximately 100 times greater than the impact of the 1993 bombing.
The ensuing fire would damage the "skin", in this scenario, as the spilled fuel would fall to the Plaza level where it would have to be extinguished by the NYC Fire Department. The replacement of the "skin" is estimated at 35% of the building replacement value or $420m. Loss of rents for 1 year or $150m for a total estimate of <$600m.
For MFL (maximum forseeable loss) determination methodology, see page 88 of the pdf.