On the heels of last week’s eminent domain ruling, Forest City Ratner took another step towards realizing its vision for a basketball arena in Brooklyn when Moody’s Investor Service gave the $500 million in tax free bonds being used to finance the Barclays Center a crucial investment-grade rating. According to a largely positive story in Crain’s yesterday afternoon, “the Baa3 rating reflects several factors, including the strength of New York City as a media market, existing sponsorship support for the team, the large amount of equity the developer and its partner are putting in the project and strong reserve funds.” And check out this quote in The Times from a vice president at Moody’s: The lawsuits are not an issue as far as the rating is concerned. The rating assumes that the lawsuits will be settled and that the project will move forward.” A more skeptical article in the New York Observer noted that while technically investement-grade, the bond rating was only one step above junk level, reflecting significant risk factors like relocation, weak team finances and “uncertain demand for premium seating.” And Atlantic Yards Report points out that the Moody’s rating assumes 225 events per year but Ratner’s on record as predicting only 200. Crain’s says that bond sales are expected to begin sometime this week.
New Nets Arena Wins Another Court Challenge [NY Times]
Moody’s Gives $500M in Nets Bonds Thumbs Up [Crain's]
Nets Arena Wins Needed Bond Rating, Mostly [Observer]
Atlantic Yards Debt Gets Rated [The Bond Buyer]