To avoid a major blow to the region's economy and world financial markets, the Port Authority was scrambling yesterday to find offices for hundreds of tenants dislocated by Friday's huge explosion at the World Trade Center.
Port Authority officials said most of the seven-building complex, which houses the trading floors of exchanges that set prices on commodities ranging from gold to cotton and from heating oil to orange juice, would be closed tomorrow.
Many domestic and international corporations use these exchanges to lock in the prices of essential supplies. An extended disruption of trading could make it more difficult for businesses to buy and sell some basic products on which they depend.
One building, 7 World Trade Center, which is separated from the rest of the complex by Vesey Street, is expected to be open for business tomorrow, and some tenants of the other buildings -- including many banks, investment firms and import-export businesses -- may be allowed to enter the damaged buildings early this week to retrieve computer records and other vital information.
The explosion in a garage between the 110-story twin towers that dominate the complex, rocked the ground with the force of an earthquake. Officials said they could not reopen damaged buildings until myriad safety systems were repaired, and they had no estimate for when the entire complex would reopen.
'Structurally Sound'
"The towers are structurally sound, but the life-support systems have been disrupted," said Charles Maikish, the center's director. "Until they're restored we can't allow any occupancy." He predicted it would be "multiple" days until the Port Authority could bypass the damaged systems and reopen the buildings.
George Rossi, the assistant director of world trade for the Port Authority of New York and New Jersey, said the closing of important sections of the complex, which contains 10 percent of lower Manhattan's office space, would be a major blow to the city's economy. He said that one Japanese bank had recently estimated that closing the center would cost it $20 million a day in trades.
"And that's just one bank," he noted. "The impact of of a shutdown of the trade center is mind-boggling."
The World Trade Center's biggest tenants include the Port Authority, which owns the buildings; the New York Commodity Exchange; the New York Merchantile Exchange; Dean Witter Reynolds; Shearson Lehman Brothers; First Boston; Ebasco Services, an international engineering company, and Guy Carpenter & Company, a reinsurance brokerage.
The closing would probably most severely affect the commodities exchanges, which are grouped together in the center. The commodity exchanges contribute $100 million to city and state treasuries every year.
While many of the companies with offices in the complex can divert their operations, financial analysts said the commodity exchanges cannot immediately operate unless the buildings reopen.
The New York Mercantile Exchange, the Commodity Exchange, the Coffee, Sugar and Cocoa Exchange, the New York Cotton Exchange and the New York Futures Exchange share trading floors in the Commodities Exchange Center at 4 World Trade Center. All closed shortly after the explosion.
Exchanges Hope to Function
The New York Stock Exchange said that the Futures Exchange, a subsidiary, would be operating by tomorrow morning, from a former trading floor if necessary. Other exchanges are also hoping to resume some operations.
Officials for the exchanges, which employ almost 14,000 people at the World Trade Center, worry about the difficulty of settling futures contracts, particularly energy futures on the New York Mercantile Exchange and precious metals futures on the Commodity Exchange.
The exchanges' difficulties were illustrated on Friday when they delayed the expiration of some futures contracts until tomorrow. It is unclear what the exchanges will do when the contracts expire tomorrow.
Further, a disruption of commodity trading would likely ripple through the world's economy. Financial analysts said any disruption would make it more difficult to set a universally agreed-upon price for transactions usually pegged to the auctions in the commodities' trading pits. Many products traded in New York, however, are also traded on foreign markets.
Other Large Tenants
The closing of the World Trade Center complex, whose six main buildings are bordered by West, Liberty and Vesey Streets and Trinity Place, could also have a major impact on other large tenants. They include the brokerage house of Dean Witter Reynolds, which rents 1.3 million square feet in two buildings.
Robert E. Wood 2d, the chief administrative officer of the Dean Witter, Discover & Company parent corporation, said the company was transferring its World Trade Center operations to several other offices in New York and New Jersey.
Shearson Lehman, which has more than 100 employees of its asset-management division in 2 World Trade Center, said it was making arrangements to provide temporary space across the street at its World Financial Center headquarters.
An executive of Cantor Fitzgerald, the largest broker in the huge market for Treasury securities, said the firm was searching for alternative offices for tomorrow but full operations probably depended on returning to its trade center quarters. "We'll be operating the businesses that have flexibility," said Robert M. Mercorella, a managing director there.
Cantor Fitzgerald also furnishes data for the Telerate service, a prime source of information on the prices of Treasury securities. Mr. Mercorella could not say whether this service, which was disrupted Friday, would resume fully tomorrow.
Any brokerage companies that cannot reach their offices or records are likely to lose some business even if they have backup plans, said John Keefe, a brokerage industry analyst whose firm bears his name. While there is plenty of office space available downtown, he said, arranging all the necessary financial data services could take between six months and a year.
It remained unclear how other companies, including large tenants would cope. All the major Japanese banks in the city, including Dai-Ichi Kangyo, Sumitomo and Hokkaido, have based their local operations in the complex and may not be equipped to move.
Space on Staten Island
The Port Authority said it was trying to provide tenants with access to required computer information and was planning to offer them temporary space at Staten Island's Teleport, which is linked to the center.
The Port Authority said it also was scrambling to set up an emergency office at Port Newark for the large number of small maritime offices at the trade center.
The closing of any significant portion of the complex could be a major blow to hundreds of small businesses -- everything from the corner deli to business printers -- who depend on the 50,000 workers and 80,000 visitors who come to the site on an average day. The World Trade Center is also a transportation hub for many who work on Wall Street. There is likely to be early-morning havoc tomorrow for commuters working at companies adjacent to the center.
While some Port Authority officials said tenants were being very understanding, they worried that the explosion would lead some companies to weaken their commitment to the city and hurt the region's reputation as a financial center.
