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October 29, 2009
NYS sets big bond sale, waits on other large issues
Reuters
by Joan Gralla
New York State's main economic arm will sell as much as $1.7 billion of debt during the week of November 16, although bond financing for two other developments -- Brooklyn's Atlantic Yards and the World Trade Center site -- have not yet been finalized.
Frances Walton, chief financial officer of the Empire State Development Corporation, told reporters after a Citizens Budget Commission conference that she did not expect lawsuits filed by opponents of the multibillion dollar Atlantic Yards project would block the debt issue by a local development corporation.
"The expectation is that they will be issued," she said. This would not be first time that bonds have been issued despite "legal challenges," Walton said.
"We have begun discussions with ratings agencies," she said.
NoLandGrab: Actually, according to a Wall Street Journal article two weeks ago, arena bond underwriters Goldman Sachs and Barclays had already "spent weeks in discussions with three credit-rating services and bond insurer Assured Guaranty Ltd. over ratings and terms on the bonds" — and the Journal called the odds of the bond sale succeeding "a toss-up."
Additional coverage...
Atlantic Yards Report, ESDC has a planned bond sale on the week of November 16 (before any court decision comes down)
Not only is the next Empire State Development Corporation (ESDC) meeting on November 19, the week of November 16 is when the ESDC will be issuing bonds, including (apparently) bonds for the Atlantic Yards arena, Reuters reports.
...In other words, they're not waiting for the resolution of the eminent domain case, nor do they think any other lawsuits could stymie the project. The driver is a December 31 IRS deadline.
Bond buyers and the bond insurance company, however, had better calculate some risk, as Michael D.D. White pointed out.
NLG: Not only did White point out all the problems with the bond issue — it's likely that his blog post prodded reporters to start asking questions.
Posted by eric at October 29, 2009 8:50 PM