The New York Liberty Development Corp. plans to re-offer bonds sold last year to finance development at the World Trade Center site and “re-escrow” the proceeds for at least a month.
LDC plans to re-offer on Thursday $2.95 billion of Liberty bonds sold in December on behalf of developer Silverstein Properties Inc.
The issuer sold the bonds and escrowed the proceeds because the developer could not use the funds before a deadline for the expiration of the Liberty bond program. Proceeds from the LDC issuance were used to purchase U.S. Treasury securities and the bonds carried an Oct. 12 mandatory tender date. At that time, the bonds were expected to be reoffered, the funds taken out of escrow, or a combination of both depending the outcome of negotiations between Silverstein and the Port Authority of New York and New Jersey. The bi-state agency owns the property, which is leased by Silverstein.
In August, the Port Authority approved a financing agreement on World Trade Center development that provides significant public support to Silverstein for the development of two commercial towers at the site.
Goldman, Sachs & Co. is the underwriter and Winston & Strawn LLP is bond counsel.
Congress created the Liberty bond program following the terrorist attacks of Sept. 11, 2001, to help revitalize Lower Manhattan with an $8 billion allocation of private-activity bonds. The Port Authority was allocated $700 million of Liberty bonds for its tower at the site but allowed the allocation to expire, though Congress could extend it retroactively.
Next week, the authority plans to sell $850 million of traditional taxable bonds for the project.