NYCIDA Authorizes $475 Million in Liberty Bonds for 7 World Trade Center
IDA Board Also Approves Assistance to an Industrial Company and Four Not-for-Profits.
New York City Industrial Development Agency (IDA) today authorized the use of $475 million in New York Liberty Bonds for the reconstruction and permanent financing of 7 World Trade Center in Lower Manhattan. Preliminary approval of the Liberty Bonds was granted in 2003 for the construction of the new building, the first to rise at Ground Zero since the tragic events of September 11, 2001.
“This is a major step in the rebuilding of Lower Manhattan and the World Trade Center site itself,” said IDA Chairman Andrew M. Alper, who is also president of the New York City Economic Development Corporation (EDC). “7 World Trade Center, the last building to fall on September 11, was the first to rise again thanks in large part to the Liberty Bond Program. This new, state-of-the-art building will provide tremendous support to the economic growth of Lower Manhattan.”
The building is located on a 58,000-square-foot site bounded by Greenwich, Barclay, Washington and Vesey Streets. The project consists of a 52-story building with approximately 1.7 million square feet, including 76,500 square feet for a Con Edison substation. Silverstein Properties will provide the management and leasing services for the building.
“The rapid construction of 7 WTC -- which will open its doors in a year -- is evidence of the exciting progress being made in the rebuilding effort, and the benefits of the public and private sector working toward a common goal,” said World Trade Center developer Larry A. Silverstein. “This Liberty Bond authorization is critical in helping to sustain the great momentum we all have achieved over the past three years.”
The new building will be 240,000 square feet smaller than the original building to accommodate the re-mapping of a portion of Greenwich Street. 7 World Trade Company ground leases the site from the Port Authority of New York and New Jersey. Construction of the facility began in May 2002, and the building is anticipated to be ready for occupancy in January 2006.
Silverstein originally applied for up to $400 million in tax-exempt bonds to finance the shortfall in sources of funds for the project. The gap increased because of lower than expected insurance proceeds and increased financing costs. Because of that, the IDA Board authorized the use of Liberty Bonds in the amount of $475 million. The Liberty Bond Program is designed to provide tax-exempt bond financing for major projects to revitalize Lower Manhattan and New York City using $8 billion in bond issuance authority provided by Congress and the President.
Separately today, the IDA Board also approved assistance for Lighting & Supplies, known as Sunshine Lighting, a manufacturer of lighting equipment in Brooklyn. The company plans to purchase and renovate a 100,000 square foot building on Clinton Street in Brooklyn. The company will receive about $2.8 million in real estate and sales tax exemptions as well as a mortgage recording tax waiver of about $211,000. It may qualify for discounted energy benefits under the Business Incentive Rate (BIR) program worth approximately $83,000, and up to $138,000 from the City’s Energy Cost Savings Program (ECSP). Also, because the project site is in an Empire Zone, the company is eligible to receive Empire Zone benefits. The $10.8 million project will add 18 new jobs to the company’s 36 employees.
The Board also approved financing for four not-for-profit organizations under the IDA’s Special Needs Facilities Pooled Program, designed to pool the needs of qualified not-for-profits to achieve economies of scale. The four service providers in the offering are all members of the Manhattan-based InterAgency Council of Mental Retardation and Developmental Disabilities Agencies. Together, Advocates for Services for the Blind Multihandicapped (ASBM) in Brooklyn, Services for the Underserved-MR Programs, Inc. (SUSMR) in Brooklyn, Services for the Underserved, Inc. (SUS) in Manhattan, and Eden II School for Autistic Children (Eden II) in Staten Island will receive up to about $9.2 million in Civic Facility Bonds. The projects are expected to create 62 new jobs.
ASBM will receive up to $1.5 million in bond proceeds to help refinance the purchase and renovation of a two-family house and turn it into a nine-person specialized residence that offers 24-hour supervision and skills training to the developmentally disabled community. SUSMR will receive about $2.8 million in bond proceeds for the purchase and renovation of three similar facilities in Brooklyn. SUS will receive about $1 million in bond proceeds to help refinance the renovation of two floors at SUS’s headquarters. And Eden II will receive about $3.9 million in bond proceeds to refinance loans and reimburse organization funds used to buy a facility, which will become the home of the Eden II’s Adult Day Training and Day Habilitation Program, as well as a building that will serve as a similar specialized residence.
The New York City Industrial Development Agency provides financing assistance to businesses, including small industrial and manufacturing companies and not-for-profit organizations. IDA is a conduit agency that issues tax-exempt industrial revenue bonds to assist eligible commercial, industrial, not-for-profit and other qualified entities to finance expansion opportunities. IDA also offers qualified companies abatements on sales, real estate and mortgage taxes. IDA is administered by the New York City Economic Development Corporation. For more information go to http://www.nycedc.com/nycida.