The New York City Capital Resource Corp. approved its first recovery zone facility bond deals at its board meeting yesterday. It plans to issue a total of $35 million of tax-exempt bonds for the three projects approved.

The board action was a preliminary step that established the projects were eligible for the financing; authorizing resolutions to market the bonds will be considered at a later date.

The city received an allocation of $120 million of tax-exempt bonds under the program which was created under the American Recovery and Reinvestment Act to help finance projects in economically distressed areas.

The largest project approved was for Albee Development LLC, which plans to use the $20 million of bond proceeds to finance the first phase of a mixed-use retail, commercial and housing development in downtown Brooklyn.

New York City Comptroller William Thompson Jr. cast a lone “no” vote on the financing through his representative on the board, citing concerns over community benefits agreements with the developer. 

The board is expected to consider an authorizing resolution for the project in January with the bonds expected to price in February. The developer expects to return to the CRC for further financing for the next phase of retail development in the project. The project is also expected to use hundreds of millions of dollars of bond financing from the New York City Housing Development Corp. to build about 750 apartments.

The CRC also approved two projects in Rockaway, Queens, as eligible to use recovery bond financing. Arverne by the Sea is a community developed by Benjamin Development Co. and the Beechwood Organization. Arverne by the Sea LLC plans use to $5 million of recovery zone facility bonds to build a new supermarket and Benjamin Beechwood Retail LLC plans to use $10 million to build a retail plaza. Some of the property is in arrears on taxes and the bonds will not be sold until that is resolved, CRC staff said.

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