Investor Day 2015 David Cooper, President, Buildings and Cco, U.S

INVESTOR DAY 2015 DAVID COOPER, PRESIDENT, BUILDINGS AND CCO, U.S.

JUNE 10, 2015

INVESTOR DAY 2015 JUNE 10, 2015

DAVID COOPER, PRESIDENT, BUILDINGS AND CCO, U.S.

Male: All right. So while you’re enjoying your lunch, I’m just going to talk about our role in the rebirth of New York following the horrendous attack on us on September 11th. And we have at this point that is quite spectacular to view what New York has rebuilt and recreated, and what we’ve been part of. And so, I’m going to try and share with you.

It’s very difficult to really capture especially as an engineer, not all that eloquent to capture the emotions that 9/11 meant for to us being at least one New Yorker. I was actually walking into our office building on Fifth Avenue at that time and I saw the plane heading south, very low which struck me as odd, walking to get a coffee. When I came back on to the street, we had the street viewed then at Fifth Avenue to Trade Center and saw it on fire. Little did I know that the plane I just watched heading south was the one that hit the tower. And a few moments later, when I was up in the office, the second plane hit.

New Yorkers who lived through that, it’s just obviously a scare that we’ll bear forever. And so the opportunity part of salvaging what was the two amazing buildings – in that day, they were the two tallest buildings in the world. They were built in the

60s and restored on 1970, and they were truly inspirational, not just to New York, but to the country as (my news as to) to what we could do in the construction world. And it was a great – it was a huge undertaking. It was a big site, 16 acres site. And you can in the picture obviously the Twin Towers, the other World Trade Center building is on this overall 16 acre site. And across the street was the original 7 World Trade Center to the north.

We’re actually right over here, in this location, from here looking north. This back point is looking east. But the destruction was rather incredible. Not just the towers came down, 7 World Trade Center collapsed as well. To this day, no one is quite sure why. It suffered some damage from debris, but pretty superficial, but it did test fire. And after the two Twin Towers collapsed, the Fire Department evacuated everybody from 7 World Trade Center and did not fight the fire and just figured the building would burn itself out as most buildings do. But it collapsed and the only steel structure in a sprint of building to do so in the U.S. and in the world, I believe.

But it was quite rebuilding effort. And we were structural engineers for 7 World Trade Center, the original 7 World Trade Center building. And when the building collapsed -- Larry Silverstein was the developer of that property as well as he had recently signed a lease to take over the operation of the entire World Trade Center site. And so what he had was fairly unencumbered to rebuild 7 World Trade 4

Center, unlike the rest of the site which it was called 7 World Trade Center was operating independently. It’s a private development. The rest of the site was related to the Port Authority and public works.

And with the monumental nature of the event, quite frankly, it became a very big public issue on what to do with the site. So we embarked further design of 7 World Trade Center. Just quickly, I’m sorry. The overall site – this -- that’s the boundary of the 16 acres, 7 World Trade Center to the north across the street. The original towers, the ancillary support buildings, the World Financial Center across the street which we’re also the engineers for from their origins in 1981, the Winter Garden which you can see the damage from debris and we are right now over here looking north.

So we started our work on 7 World Trade Center to re-engineer it right away. Through our relationship with Larry’s solution Silverstein, you know, who worked on original towers who we’re just appointed to the project, along with the architects Skidmore, Owings & Merrill. And that work began in earnest in 2002. And while that design work was undergoing by Port Authority, and in counsel with the New York State, and Larry Silverstein to develop a design competition to see what should be rebuild on this site. And obviously, there was a lot of questions about whether you want to build a tall building again and will people occupy really tall building, and what’s the – which of the whole site being memorial, what should be done on this site. 5

So there was a competition done while we were working on developing 7 World Trade Center. And once that competition was done and it was decided what the program would be, there was a separate design competition for the memorial which was an international competition with about 5,000 entries. And I’ll talk more about that in a minute.

But as you can see, we started the work in 2002. The original plan was to have the entire site rebuild like 2015. The 1 World Financial Center, the Freedom Tower, it was called then. The 1 World Trade Center was supposed to be done by 2008. But as you might expect in a very public contentious process, financially challenged, the insurance claims, funding, infrastructure, complexity of the site and just a tremendous amount of public scrutiny, things did get delay. We also saw out there financial collapse in 2008, 2009.

So here we are today, substantially complete in 2015, but still ways to go and we’re still quite involved through all of it. So 7 was the first tower to get built and that’s directed after winter straight ahead. The tower across this – the farthest tower you see, the West Tower. 7 World Trade Center was the first one to get reconstructed. And where the challenge is that with the lower floors, the lower 10 floors of that building, the original building as well as the new building was the -- kind of assume substation, the utility electric power company substation have powered all of Lower Manhattan. 6

So there was a tremendous amount of challenge about developing – having then rebuild that substation doing a construction above it, and also, taking all the loads down at the building with a new resilient structure and bypass their substations and do that coordination.

The tower is a very similar structural concept of 1 World Trade Center. It’s a concrete core and a perimeter steel framework. I’ll talk about that in a moment. The interesting thing is in New York, when you look at the construction of 7 World Trade Center, you don’t see a concrete core. When you see it, the structure, the steel structure is going up. And in New York, within regulation, the traditional method of building a building was you put in the steel first, then you follow with a concrete second. And that’s unusual to anywhere else. So that’s one of the complexities that we had to deal with in terms of understanding the design and construction sequencing.

So as compared to The Shard in London which had the similar concrete core and a proven steel frame, you see the concrete core coming up first and ahead of the steel structure. So 7 World Trade Center, One World Trade Center was built in our minds backwards, steel first followed by concrete, with a concrete core. But the next building is going up, the second – World Trade Center Two is going to reverse that as the city has adopted some more modern practices and codes.

So this was some of the master plan competition for what should be developed on this site. Some kind of crazy ideas, some interesting ideas, but ultimately, architect by the name of Daniel Libeskind won the competition for what master plan should be. And his concept was four office towers around the memorial park with a cultural center and a transportation hub. So you could see the World Trade Centers 1, 2, 3 and 4; a memorial plaza; there’s a performance hall back here; and there’s the train station – train hub back here.

I should add that while we got involved on the structure site for the redevelopment, their transportation business was also hired to help manage and master plan all of the railing constructions that got destroyed ante the rebuild for the PEP trains and the subway lines. So it was actually a – it was not just a story about our structural engineering on this site, but we were very involved with transportation side as well.

So that was the original concept. You can see the World Trade Center had a bit of a different shape than what it ended up. But what ended up was a very similar concept just some different architecture on World Trade Center One. That was primarily due pragmatic reasons. This building had to be commercially liable. And quite frankly, I think the beliefs and concepts as it was getting developed proved to be not a problem with everybody. It was a very (ostentured) core. It was an outstanding core. And when you get to the buildings, the site 8

symmetry is important for a structural stability purpose. So that became a pragmatic issue.

But Libeskind and Skidmore, Owings & Merrill worked together to come up with a new design for World Trade Center One. But otherwise, the plan is the same, the memorial park, the memorial museum entrance, the transportation hub and a cultural center. And Libeskind stayed involved in overseeing the overall site of different architectural hires to do each of the buildings. So Tower One is Skidmore, Owings & Merrill. Tower Two was Foster and I’ll talk about that in a minute – a little bit later. Tower Three was Richard Rogers out of the U.K. And Tower Four is KPF.

We are the structural engineers for all of the work here except the Tower Four and except for the above ground collar (covered) trenches. We’re doing all the below-ground work. And there were a lot of challenges with all of that and I’ll talk about some of that. So this is us rendering, I guess, that during construction, what you can see Tower Four well under way. It was one of the first towers built. It was the first tower completed. Tower One well along. Tower Two, over there, taking up two just grade level because all of the underground had to get this line and built, because all of the underground is interconnected. And so, we would – all the engineering below grade had to get completed so that tower designs had to be done, so that foundations could be designed and all the below- grade work installed. 9

So Tower Two was taken up grade level and then stopped because of the commercial issues with their financial collapse. Tower Three was taken up by the 12th floor and stopped, and just restarted again last – I think in October of 2014 when they’ve (landlord and tenant). Tower Two has announced just yesterday that they’ve (landlord and tenant) – that building is now progressing with a completely different design.

So One World Trade Center was quite a project, a couple – quite a few challenges. Number one, everybody in the aftermath of the collapse said we need to re-bend the codes. We need to look at what we wanted to do in terms of building resiliency, an operational resiliency; fuel oil system; structural systems; stair widths, having dedicated stairs for fire members because one of the things they found was the firefighters had trouble getting up the building because everyone is coming down the building. Some of the stairways were completely blocked off. Some of the infrastructure was destroyed, limiting firefighting capability in the building.

So there were lots of things that happened that have to be learned from the collapses of one and two and seven, and so, everything was influx. And so our challenge was to design a building that would be future proof, that would be commercially viable and stand up to what the future codes were going to be. Not an easy thing. Architecture was demanding and so the (city) requirements were demanding. The 10

Port Authority requirements were demanding. It was all under public scrutiny. And so it was interesting process, to say the least.

But a couple of things, One World Trade Center very much respect the original Twin Towers. It is 1,776 feet to the top of the spire and the castle and tall buildings were over an habitat has different ways of measuring heights of buildings. But as long as its spire is not (protruded), but they think it’s integral with the structure and not just a bolt-on, it counts into the height of the building. So that’s one measure. So that makes it the tallest building in the western hemisphere. That’s 1,776 footmark.

The roof line is 1,368 feet. It’s the same elevation as the original World Trade Center so that’s respectful of that. The base of the tower is 200 by 200 which are the dimensions of the original World Trade Center towers in an inch square so it’s respectful of that. But then the design, the twist noticed spire intended on the design versus a straight rectangular form is at the top-square – it’s all set 45 degrees from the bottom square. And when you click those corners, it creates these triangles. So in the middle of the building, it creates an octagon.

But it’s respectful in many ways to the original World Trade Center in height, roof level height and lower level. You’ll see down here, in the lobby, and then this is a zone of (semi P). This is – again, this is really a structural transfer zone, and then a (P zone), and it’s the top bend. When you look at One 11

World Trade Center, it all looks the same from street up to that – up to the point where you start having the glass. But that’s the brightness of the two different forms in there which is; one is the structural (MEP) space and one is the – and below that, at the bottom, 60, 70 feet is the lobby.

This is similar to 7 World Trade Center. It is a hybrid structure. So the original World Trade Center was all steel construction. And this is core – a concrete core with a steel perimeter frame that together works to withstand the wind loads and lateral forces as well as the gravity loads on the building. But one of – in many respects, it’s a bit (top) from a standard structure. You might have seen this in type of structure in earlier versions of very tall buildings. But there are a lot of enhancements to the structure for security purposes which I can’t talk about, and some of which I don’t even know.

There’s a tremendous amount of work done on what’s the level of threat would be to the building and what’s the best way to mitigate that threat in terms of design and resiliency. And again, in a pragmatic cost-effective way because it had to be a commercially viable building. There were things that are visible when you walk into that building, in terms of the massiveness of some of the concrete elements and the structural elements. And a lot of attributes of that are invisible and not known which is which should be.

Some of the construction, as you can see, this is the top. This is the lobby level and this is the top known as the mechanical transfer. It’s hard to tell from the scale but very – some of the unique geometry from some of the structural requirements – some of these are really large structural transfer mechanisms that were very especially challenging to engineer. But again, you could see – you don’t see the concrete core coming up. You see the steel going up first, followed by the concrete core comes afterwards.

So I did talk about – we’ve been talking about the challenge around the security, resiliency. The World Trade Center is in its (classroom) for progressive collapse, force collapsing causing the floors below to collapse. So the question was how do you prevent progressive collapse, how many columns should be able to fail and still maintain the building upright, and all thoughts with the stairs as dedicated stairs, elevators – dedicated elevators for firefighter’s access, all of pieces as well. So there were a lot of things in collapse and we worked very closely with the city.

The city was going through its own code adoption process which working to international mechanical and electrical codes; and structural codes versus New York City which had its own code dating back from 1968. So there were just a lot of things in way which caused it to be extremely challenging process and time-consuming process. But there’s a lot of diligence among all the stakeholders to come to conclusion and to grab the best way forward. 13

Three World Trade Center is another building under construction. You see the steel is a bit – I mentioned it started to work again. It’s about all too soon a 3 million square feet. One World Trade Center is 2.5 million square feet. But it’s a lot shorter than One World Trade Center. And it’s loaded with 80 storeys. But again, working with world class architects – that’s Richard Rogers, the phenomenal architect out of U.K. Each of these buildings has a world class architect which has its own unique requirements to satisfy their vision, and working with them to satisfy their vision.

Two World Trade Center was announced just yesterday. That’s going to be in far corner pass where we could see the structural spires of the (Cortland) traveler's train shed and the void between that in the next – in the (Misny) building pass it. Two World Trade Center is going to rise and this could be just almost as tall as the One World Trade Center. And it has a new architect. The active tenant is Murdoch and News Corp, and they were in locked on this really high-end global architect called BIG, Bjarke Ingels. It’s the architect’s name out of the Netherlands. And it’s going to be a very special building as well.

We’re just embarking on that now. We did completely the design of this World Trade Center Tower Two with Normal Foster. We’ve got built up to the ground level and capped as I told you. And now, the challenge is to take a totally different 14

building design and re-use the foundation and everything below grade, and figure out how to get that all to work properly. But we just thought at the design of this building in (earnest) about a month ago.

And then we get to the memorial. Memorial – I’m going to talk about the memorial. I’m actually going to read what the architect who created the memorial wrote in his design submission. Michael Arad was, I believe, about 28 when he developed the concept of memorial. He partnered it up with a landscape architect. He was an architect, the building’s architect. He worked for KPF for a couple of years. But he did this on his own without a firm behind him. He was awarded this. He won the competition out of a field of 5,200 entries internationally. I think he was 28, maybe 29.

And I found this – it’s going to take a minute and if you’ll indulge me and read what he wrote because he’ll be able to explain it much better than I can.

The memorial proposes a space that resonates with the feelings of loss. I’m sorry. I had to repeat. The memorial proposes a space that resonates with the feelings of loss and absence that were generated by the destruction of the World Trade Center and the taking of thousands of lives on September 11, 2001 and February 26, 1993, which was the date of the first bombing of the World Trade Center. It is located in a field of trees that is interrupted by two large voids containing recessed pools. The pools are 15

set within the footprints of the Twin Towers. A cascade of water that describes the perimeter of each square feeds the pools with a continuous stream. They are large voids, open and visible reminders of the absence.

The surface of the memorial plaza is punctuated by the linear rhythms of rows of deciduous trees, forming informal clusters, clearings and groves. To its annual cycle of rebirth, the living park extends and deepens the experience of the Memorial. Surrounding the pools on bronze parapets are the names. The enormity of this space and the multitude of names underscore the vast scope of the destruction. Standing there at the water's edge, looking at a pool of water that is flowing away into an abyss, a visitor to the site can sense that what is beyond this parapet edge is inaccessible

The memorial plaza is designed to be a mediating space; it belongs both to the city and to the memorial. Located at street level to allow for its integration into the fabric of the city, the plaza encourages the use of this space by New Yorkers on a daily basis. The memorial grounds will not be isolated from the rest of the city; they will be a living part of it.

It’s a – I mean, of all of the buildings that were involved down here, the memorial is the most intense and it is a quite spectacular space. I hope you all get the chance to walk through the Memorial Park and get into the museum. In the museum itself, 16

the remnants of the original World Trade Center Tower – that’s the entry way to the museum where you see some of the original structure.

This is – we didn’t talk about the underground. But the whole 16-acre site is a slurry wall bathtub holding up to Hudson River, and that bathtub we were part of the engineering – a part of our engineering was to reinforce that bathtub to make sure it held up when all the infrastructure inside was taken out because all those slabs that stand on the ground were holding up those – were supporting those walls from falling in. So we have to support those while everything is excavated and rebuilt. So that’s just an exposed version or exposed element of the slurry wall with tied bags into the ground – into the earth to hold it up.

The overall design which was very sustainable project as well and our structural engineering is not – is a limited in its contribution to structural building and development sustainability, but we did our part, reconstituted materials, fly ash and steel, local construction. We did whatever we could to help contribute to the sustainability of the development. And most of the site is rebuilt.

But overall, between four, five incredible architects, world class architects, Port Authority, the public process, the commercial rigors of the job, the public scrutiny of the job that was tremendously complex. It took a lot of patience and leadership on our structural teams part to get through it at its peak. We 17

probably have about 60 to 70 engineers working on the project. It doesn’t sound like a whole lot for what was done. But a lot was in New York at that time. It was about 100 people. So it’s a big chunk of our capacity. And they worked really, really hard and diligently, sacrificing a lot of personal time because they all believed in the project.

That’s it. It’s quite a complex part of rebirth. Lunch and dessert is out on the patio. So I’m happy to answer any questions, point anything out to you out there. There are also a lot of buildings that we can see that are ours in the neighborhood beyond the World Trade Center site. But if you have any questions before we go outside for dessert, I’m happy to answer them.