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September 7, 2011
Liberty Bonds, 9/11, and Forest City Ratner: the first subsidy for a commercial tower (the only one in Brooklyn) and the largest subsidy for a residential tower
Atlantic Yards Report
While Forest City Ratner was not the largest beneficiary of post-9/11 federal recovery funds, it was among the savviest, gaining the first triple tax-exempt bonds for commercial projects, the Bank of New York Tower at Atlantic Terminal, which was the only project outside of Manhattan.
Beyond that, FCR garnered the single largest share of the relatively small amount of tax-exempt bonds designed for housing, aiding construction of the Beekman Tower (aka 8 Spruce Street aka New York by Gehry) in Lower Manhattan.
Thus, in gaining nearly $300 million in tax-exempt (federal, state, city) bonds, the developer saved tens of millions of dollars by paying a lower interest rate. It's more evidence for scholar/writer Fred Siegel's characterization of Bruce Ratner in the 11/30/05 Cleveland Plain Dealer: "He's the master of subsidy."
Yesterday, in a New York Post op-ed headlined Liberty misspent: Political use of rebuild bonds, Nicole Gelinas of the free-market Manhattan Institute suggested that, given that so much of the aid, including up to $8 billion in Liberty Bonds for real estate, went outside of Ground Zero, "New York squandered time and money doling out favors."
Beyond Gelinas's argument, there's evidence, described below, that the Bank of New York is not now meeting the requirements for job retention that justified another chunk of subsidies it gained.
Posted by eric at September 7, 2011 11:24 AM