Uncertainty, Skepticism Around Arena Bond Offering

There was a lot of discussion last week about the viability and timing of the issuance of debt to finance the construction of Barclay’s Arena, the centerpiece of the Atlantic Yards project. First, on Wednesday, the blog Noticing New York wrote, “We have never seen so many loose ends and approvals that are not in place.” On Thursday, Reuters followed up with an article that quoted the ESDC chief financial officer Frances Walton as saying “The expectation is that they will be issued…We have begun discussions with ratings agencies.” That same day Bond Buyer quoted Ms. Walton as saying, The structure and the timing of the bonds are still in flux, (Two weeks ago The WSJ called the odds of the bond sale going through a “toss up”); the same article also floated the idea that the bonds could be structured with an early call to be exercised in the event that the plaintiffs prevail in their eminent domain case (which is expected to be decided by the end of this month but not before the issuance date scheduled for the week of November 16. Noticing New York followed up with its own analysis on Friday, questioning whether such a structure would threaten the tax-exempt status of the bonds. Meanwhile, the Community Development Financial Institutions Fund, a Federal entity, just gave $55 million to Forest City Community Development Entity, LLC in Brooklyn. As Atlantic Yards Report points out, grants from the Financial Institutions Fund are targeted at “highly distressed low-income communities,” the kind where Ratner plans to sell condos at $1,217 a foot.
ESDC’s Bond Buyer Happy Talk About Arena Bonds [Noticing New York]
So Many Unchecked Approval Boxes [Noticing New York]
Sale of Nets’ Arena Debt Is Tough Shot [WSJ]
NYS Sets Big Bond Sale, Waits on Other Large Issues [No Land Grab]
Atlantic Yard Bonds May Be Sold, Escrowed [Bond Buyer]
Bond Buyer Article Excerpted [DDDB]
Forest City Gets $55M [AYR]
Photo by Tracy Collins