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December 2, 2009
Atlantic Yards Debt Gets Rated
The Bond Buyer
by Ted Phillips
Moody’s Investors Service and Standard & Poor’s gave the bonds for New York City’s controversial Atlantic Yards basketball arena their lowest investment-grade ratings yesterday.
Moody’s assigned a Baa3 with a stable outlook to the Brooklyn Arena Local Development Corp.’s $500 million of senior tax-exempt bonds, and Standard & Poor’s assigned them a preliminary BBB-minus.
The issuer plans to sell the bonds, which are backed by payments in lieu of taxes, to partially finance the construction of the Barclays Center, a $1.06 billion, 18,000-seat complex that will be the future home of the National Basketball Association’s New Jersey Nets franchise.
In assigning the barely investment-grade rating, Moody’s compared the arena’s projected revenue streams to comparable sports centers, including the new stadiums for Major League Baseball’s New York Yankees and Mets and an arena in Louisville, said Moody’s analyst Richard Donner.
...Projections vary over the years, but in the first year the biggest revenues are expected to come from sponsorships, at 30%, premium seating at 24%, and the naming rights agreement with Barclay’s Capital at 10%, Donner said. Rental payments from the Nets will generate a projected 8%.
Click through for many more details about the bonds.
Posted by eric at December 2, 2009 10:16 AM