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Dangling Crane Draws New Attention to Luxury Tower

One57, a luxury apartment building, in New York.
Victor J. Blue | Bloomberg | Getty Images
One57, a luxury apartment building, in New York.

One57, a luxury apartment building in Manhattan that has grabbed headlines for its use of controversial tax breaks, was being closely watched by emergency teams, as a crane, apparently knocked loose by Hurricane Sandy, dangled from its topmost floor.

The crane partially collapsed Monday afternoon, and remained dangling Tuesday from the top of the $1.5 billion skyscraper.

Some nearby buildings, including 900 guests at the Parker Meridien hotel, were evacuated as a precaution and the streets below were cleared. The block includes Carnegie Hall.

Mayor Michael Bloomberg said it wasn't clear why the accident happened.

"It's conceivable that nobody did anything wrong and there was no malfunction, it was just a strange gust of wind," Bloomberg said.

Jason Kenna of Heede Southeast, which supplies cranes to builders but was not involved in the One57 project, said that cranes are made to withstand hurricane-force winds. He expressed no surprise that the crane was left in position during the storm. "Cranes are designed to 'weathervane', or go with the wind," Kenna told CNBC on Tuesday.

Kenna called the crane's collapse "a peculiar situation," and said a fix wasn't immediately clear. A first step would be to tie the crane back to the building to give it more support, he said.

The building, just south of Central Park, has already attracted several billionaires with 65 of its planned 90 stories complete. It is projected to be the largest residential tower in New York when it is finished sometime next year.

One57 is frequently mentioned as a contender to exceed $100 million for the sale of a single apartment. Last summer it was reported that the prime minister of Qatar had bought a two-story penthouse for $90 million, breaking the known record for Manhattan of $88 million. (Read More: Mystery Buyer for $90 Million Apartment Revealed)

Crews have inspected the crane, though they had no plans to try to remove it, according to Lewis Colletti, CEO and president of the Building Trades Employer Association, which represents construction companies in New York City.

"Efforts to dismantle the crane at this point would provide more of a danger," Colletti told CNBC on Monday.

Colletti said that construction companies throughout the city, including this project, have been working with the buildings department since Friday in securing to the best degree that anyone could in preparation for Sandy. All construction sites were supposed to be secured and closed as of 5 p.m. Saturday.

Recently, Extell, the developer for the project, has come under scrutiny for its use of a city program that grants deep property-tax abatements in exchange for providing low-income housing.

There are no low-income residences at One57, however. As CNBC's Robert Frank reported in earlier this month, "One57 used a popular loophole in the law that allowed the developers to take the tax benefit for the building overlooking the park, but fund the affordable housing units in another location."

City officials now say they are requesting more information from Extell before approving their application to the program. (Read More: City Scrutinizes Tax Breaks for Luxury Tower)

The Associated Press contributed to this report.

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