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October 17, 2009
Skeptical bond market could be latest hurdle for NJ Nets' Brooklyn arena project
The Star-Ledger
By Michael J. Fensom
This article gives reasons to be skeptical regarding the proposed Atlantic Yards project being built.
A Wall Street Journal report Friday indicated that the tough bond market could present the latest challenge for the Nets' Brooklyn arena project.
Of course, the first order of business for the Nets is overcoming the property-rights case levied against the team by Brooklyn residents. But, if the case is resolved in favor of the group hoping to develop the Atlantic Yards, the clock will start ticking to issue the bonds.
The developers have until Dec. 31 to issue the bonds that will fund $700 million of the arena's estimated $900 million cost, or the debt's tax-exempt status will be lost.
Furthermore, if the developers cannot get an investment-grade credit rating for the bonds, the bonds' interest rates will rise, making them unattractive to investors.
So as the Nets' hearts are set on Brooklyn, the reality of the arena project -- the linchipin of the proposed move -- still has a long way to go before coming to fruition.
Posted by steve at October 17, 2009 7:18 AM