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March 21, 2009
Towering inferno
Gumby Fresh
Gari N. Corp, who somehow manages to make things like tranches and subordinated debt sound droll, ponders what the Beekman Tower haircut portends for New York City's other Bruce Ratner — Frank Gehry collaboration.
What does this mean for the Atlantic Yards situation? The differences are legion, in particular the fact that probably the first bit of AY to come to market is the arena, which will have a different, though not necessarily better, economic profile than Beekman. But the fact that a project with this bank letter of credit enhancement is struggling quite probably blocks off the last best hope of finding someone to guarantee the AY bonds, since the bond insurers really aren't that interested in terrible basketball team relocations right now. A commenter ages back pointed to the Beekman financing as one model for what FCR might do on AY. I think by now it's a shining example of the perils of applying such a solution to the doomed Brooklyn arena.
Posted by eric at March 21, 2009 12:40 AM