State Agency Planning $700M Refinance of 1 WTC

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A New York state agency created to redevelop Lower Manhattan after the Sept. 11 terrorist attacks approved $700 million in bonds to refinance 1 World Trade Center — the tallest building in the Big Apple.

New York Liberty Development Corp. plans to issue bonds this month for the Port Authority of New York & New Jersey — which co-owns the building with The Durst Organization — that will be used to redeem securities sold to help finance the tower in 2011, Bloomberg reported.

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“Given the current interest rate environment, the Port Authority is looking to refinance the Liberty bonds,” a spokesperson for the Port Authority said in a statement.

The state agency also separately approved Goldman Sachs Group as the manager of a $525 million refinancing for developer Larry Silverstein’s nearby 52-story building, 7 World Trade Center, which opened in May 2006, Bloomberg reported.

The refinancing of both properties is a win for Silverstein. Seven World Trade Center — which sits on the land once occupied by the Twin Towers — was partially financed by the insurance money Silverstein spent years in court to obtain. 

The New York Liberty Development Corp.’s plan comes as the value of New York City office buildings dropped by $29 billion during the pandemic, according to estimates from New York State Comptroller Thomas DiNapoli. The comptroller’s office doesn’t expect real estate values to return to pre-pandemic levels until 2025, Commercial Observer reported.

One World Trade Center is home to tech-focused firm Constellation Agency, which has 48,000 square feet in a sublease from Condé Nast; social media platform Reddit; and global multi-line reinsurer SiriusPoint.

New York Liberty Development Corp. and Durst declined to comment. Silverstein Properties did not immediately respond to a request for comment.

Celia Young can be reached at cyoung@commercialobserver.com.