New York City officials are betting on the success of Hudson Yards. Taxpayers could soon take advantage of this risk.
The Hudson Yards Infrastructure Corporation, a branch of the city used to fund neighborhood redevelopment, has transferred around $ 663 million to the city since 2017, Bloomberg reports. These funds were generated by excess property taxes and other sources of income.
The infrastructure company sold $ 2.7 billion in debt to finance an extension of the No.7 metro line to access the neighborhood, as well as a park. It cost $ 360 million to subsidize interest payments on the debt and $ 230 million to cover cost overruns and planned future spending, both of which could be covered by the transfer.
The city estimates that Hudson Yards will generate a total of $ 27.1 billion this fiscal year through 2047, Bloomberg reports, among other promising indicators such as an average office asking for rent of $ 118.54 per square foot and a estimated drop this year of just 6% in property tax. bond-backed income, despite struggling commercial real estate amid the pandemic.
A spokesperson for Mayor Bill de Blasio called the development “a financial gain for the city”.
Additionally, Fitch Ratings, S&P Global Ratings and Moody’s Investors Service have all improved the company’s bonds ahead of a $ 452 million issue this week, which is largely supported by property tax revenues and will refinance bonds issued in 2011. Fitch upgraded its rating to A +, S&P to AA- (one step above A +) and Moody’s to Aa2 (one step above AA-).
The New School so far estimates taxpayer spending for Hudson Yards at $ 2.2 billion, according to Bloomberg. This includes income from tax breaks received by developers and spending on a local public school and performance venue. Critics claim the money could have been directed to other initiatives.
The area could bring more good news in the future, depending on the recovery of its local residential and hotel markets. Nearly 10,000 rental and condo units and 8,500 hotel rooms have already been built in the neighborhood, which includes related companies’ Hudson Yards and Brookfield’s Manhattan West.
[Bloomberg] – Holden Walter Warner