Copyright 2002 Bell

September 9, 2002

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HEADLINE: NY State and City to Recommend $114M Liberty Bond Issuance for Brooklyn Tower

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NEW YORK CITY-New York State and New York City today will both recommend that the New York Industrial Development Agency Board of Directors approve a $113.9-million Liberty Bond issuance for development of a 396,000-sf, 10-story office tower above the Atlantic Terminal Transit hub in Downtown Brooklyn. The recommendation will be given at the IDA meeting today, according to a release.

"The first Liberty Bond project will go a long way towards securing lower Manhattan's position as the financial capital of the world while contributing a great deal to the future of Downtown Brooklyn as an important central business district," says EDC president Andrew M. Alper. "Liberty Bonds are yet another example of how the Federal, State and City governments are working with the private sector to revitalize and rebuild New York," says New York City Economic Development Corp. chairman Charles A. Gargano.

The recommendation, of course, does not guarantee an approval. Last month, the New York State Housing Finance Agency, the Liberty Bond Program's residential issuer, voted to [http://pqasb.pqarchiver.com/globest/docsearch?b2cc161983041]table $215 million in Liberty Bonds as it turned down proposals totaling $100 million for a 287-unit building at 10 Liberty St. and another $115 million for the 264-unit Battery Park City Site 19B.

If ratified, Forest City Ratner's FC Hanson Office Associates will begin construction later this year. Forest City has already received $2.5 million in a mortgage-tax waiver to offset construction costs on the Atlantic Terminal's retail component: a 375,000-sf complex currently underway on the 3.6-acre site, bounded by Flatbush Avenue, Atlantic Avenue, Fort Greene Place and Hanson Place in Brooklyn.

The Bank of New York plans to relocate 1,400 employees to the location by mid-2004, and has already committed to 80% of the space. Last month, the IDA [http://pqasb.pqarchiver.com/globest/docsearch?fb91152496821]awarded BNY a $37.5-million WTC Job Creation and Retention Program grant as well as sales-tax exemptions of $2 million in return for keeping 7,700 jobs in New York City--6,160 in lower Manhattan, 1,400 at the Atlantic Terminal location and 140 elsewhere in New York City for at least 12 years. The bank recently began moving 4,000 employees back into Downtown Manhattan with the [http://pqasb.pqarchiver.com/globest/docsearch?d837161983411] reopening of their Technology and Operations center at 101 Barclay St.

Prior to Sept. 11, The Bank of New York occupied 2.5 million sf of office space in lower Manhattan. Two of its locations: the Technology Center and 100 Church St., were severely damaged by the attacks. Employees at those locations were temporarily relocated to 23 Wall St.

The New York Liberty Bond Program provides tax-exempt bond financing for major projects to revitalize Lower Manhattan and New York City, generally using $8 billion in bond issuance authority provided by Congress and the President. Of the $8 billion, up to $800 million may be used for retail projects and up to $1.6 billion for residential rental projects in Lower Manhattan, and up to $2 billion for commercial projects in New York City outside Lower Manhattan, issued by the IDA and the New York Liberty Development Corp.

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