New York Law School completed $142 million in bond financing on its 185 West Broadway building just before narrowly escaping disaster when a deadly crane collapsed outside its doors in Manhattan earlier this month, Real Estate Capital has learned.
US Bank acted as trustee on the package, made up of tax-exempt revenue refunding Series 2016 Bonds, the proceeds of which were loaned to the law school and used to pay off bonds from 2006 that were used mainly to acquire the land and build the property.
“Our financing is complete and there is no impact [from the crane collapse] on our financing package,” school spokesperson Silvia Alvarez confirmed via email.
The 30-year fixed rate debt was issued through the conduit issuer Build NYC at a 3.94 percent interest rate. “The mortgage served as a security package to investors, enabling the school to take advantage of a historically low interest rate environment,” Alvarez said, noting that the prior debt was entirely variable rate.
On Friday, Feb. 5, a giant red crane collapsed in Manhattan’s Tribeca neighborhood next to the law school’s three-building complex, which also includes 47-57 Worth Street, crashing down along that street and across its intersection with West Broadway when workers tried to stabilize it during a storm, crushing cars, killing one and injuring at least two others. The financing was completed just days before, on Jan. 28.
The hook end of the crane crashed into and damaged two offices in one of the law school’s Worth Street buildings, including the roof and the parapet above, but the 185 West Broadway building escaped major damages, incurring just a broken window, Alvarez said.
The more heavily damaged building has been secured and cleaned, while the associated costs will be covered by insurance, she said. The new financing agreement, as it appears in city property records, stipulates as is standard that the debtor must maintain property insurance throughout the terms of the new mortgage, including coverage of property damage.
“We were fortunate that the crane collapse had virtually no impact on New York Law School’s operations or our ability to quickly resume our academic and other programs,” Alvarez added. “The crane fell on Friday morning. We were able to resume library operations on Saturday and convene normal class schedules and operations the following Monday.”
The New York City Fire Department and police used the school for emergency meetings during the collapse. The crane killed David Wichs, a Harvard-educated immigrant from Prague who worked at a financial trading firm.