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Yes, GFCP paid the required $11M installment for railyard rights (thanks in part to EB-5)

Given the histories of delays and renegotiations regarding payment for development rights to the Vanderbilt Yard, I wondered if Greenland Forest City Partners would pay a large required installment payment due this past June 1.

They did, as MTA spokesman Aaron Donovan confirmed last month. But there's a little more to the story: they likely got the money cheap, thanks to a below-market EB-5 loan.

The history

As stated in the Metropolitan Transportation Authority's June 2009 staff summary (originally here), after Forest City Ratner renegotiated the terms, no longer willing to pay the full $100 million in cash pledged:
FCR would pay $20 million in cash for the property upon which the arena would be built. FCR would pay to MTA/LIRR for the air rights parcel an amount equal to eighty million dollars ($80,000,000) net present value as of January 1, 2010, discounted at 6.5% per annum as follows: down payment of $8 million, payable in four equal annual installments of $2 million each on June 1st of 2012, 2013, 2014, and 2015; remainder of the purchase price payable in fifteen annual installments of approximately $11 million each beginning on June 1, 2016.
To be precise, part of the arena is located, between the former Pacific Street and Atlantic Avenue, on part of the former railyard parcel, while another part is located, between the former Pacific Street and Dean Street, on what was once a public street and private property.

That meant, after paying for the part of the railyard needed for (part of) the arena parcel, the developer would pay only $8 million through the end of May 2016, then face 15 annual payments of $11 million, a much larger lift, with the final payment in 2030. (Remember, that implied 6.5% interest rate was pretty gentle, as I wrote in my summary of the MTA deals.)



Source of the money

So where did it come from?

After all, as I reported 5/8/15, Forest City and Greenland raised $249 million in the second round of cheap EB-5 financing from immigrant investors, which can be be used for the railyard, as well as to pay the Metropolitan Transportation Authority for development rights, and more.

So a September 2014 letter (bottom) from Empire State Development, the state agency overseeing/shepherding Atlantic Yards/Pacific Park, makes it clear:


So that means less cost to the developers. They not only got a better deal from the MTA, the delay gave them time to arrange below-market financing.

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