By Josh Rogers
New York State gave preliminary approval Thursday for tax-free bonds to finance an 800-foot headquarter building for Goldman Sachs in Battery Park City and to open the first National Sports Museum along the famed “Canyon of Heroes” in Lower Manhattan.
Both projects will use Liberty Bonds to pay for over half the construction costs. Goldman is looking to get $1 billion in bonds to build a $1.8 billion building at the parking lot site bounded by the United Artist cinemas and Murray, Vesey and West Sts. The sports group will build an $80-million museum on the first three floors in the landmark Standard Oil Building at 26 Broadway using $52 million worth of bonds.
Congress approved the $8 billion Liberty Bond program in the months that followed 9/11 as a way to help Lower Manhattan recover after the terrorist attack. If the two projects win final approval, it will leave about $3.5 billion in commercial bonds, most of which will be needed to rebuild office towers at the World Trade Center site.
Gov. George Pataki and Mayor Mike Bloomberg praised the Goldman project as important to maintaining Downtown as the financial capital.
Henry M. Paulson Jr., chairperson and C.E.O. of Goldman Sachs, said, in a statement:
“We are delighted to reaffirm our 135-year-old commitment to Downtown Manhattan.”
Goldman, which occupies several Downtown offices including its current headquarters at 85 Broad St., is continuing to negotiate a ground lease with the Battery Park City Authority for the parking lot area known as Site 26. Officials with the authority, a state-controlled agency, did not return a call by press time.
Community Board 1 voted conditional approval of the Goldman project a few months ago. The investment back has pledged to spend about $4 million to build a public library in B.P.C. and to help pay for a community recreation center in Tribeca.
Anthony Notaro and Jeff Galloway, two C.B. 1 members who live in B.P.C., both said the discussions with Goldman over the library and rec center have gone well and they are not overly concerned with the size of the building.
“Assuming everything is ironed out it will be a positive development for the neighborhood,” said Galloway.
The building is designed by Harry Cobb of Pei Cobb Freed & Partners.
The deal was criticized by Good Jobs New York, which said the state has not conducted an open process with respect to the use of 9/11 related funds and that the public money involved is not being well spent.
The B.P.C.A. and Goldman are negotiating a ground lease running through 2069 that will provide an estimated $13.4 million worth of sales tax exemptions for the bank if it increases its current level of jobs.
Bettina Damiani of Good Jobs said there were better ways to create jobs with the money.
“The sales tax breaks are disturbing,” said Damiani. “If you give $13 and a half million to community groups to train workers [instead], it adds up.”
Pataki and Bloomberg said the firm has promised to maintain its total of 9,178 city jobs and hopes to grow by 4,000 jobs by 2019.
Goldman is also eligible to get $25 million if it doesn’t cut its work force by more than 300 workers over the next five years, and $10.3 million in energy discounts, according to a press release issued by Pataki.
Stephanie Greenwood, also of Good Jobs, said another problem is it is hard to keep track of what the Empire State Development Corp. does with respect to Liberty Bonds. She said the city is easier to watch over because the city’s Economic Development Corp. posts public hearings on its Web site and always advertises its public notices in the New York Post. She said E.S.D.C. does not put meeting information on its Web site and advertises different projects in different papers.
Chapin Fay, an E.S.D.C. spokesperson, said the public hearings on the Goldman project have not been scheduled yet and when they are, the agency will take out a public notice ad in a general circulation paper, as is required by law. He said the Battery Park City Authority will handle the public hearing process with respect to the $13.4 million sales tax exemption once the ground lease is signed.
State officials said the Goldman building will be the first corporate headquarters built in Lower Manhattan since 1988 when JP Morgan finished moved into its home at 60 Wall St.
The Liberty Development Corp., a subsidiary of E.S.D.C. gave the Goldman and Sports Museum projects preliminary approval on Thursday.
Philip Schwalb, the museum’s founder and C.E.O., said he already has most of the private investments he will need to build the $80 million museum, once he gets the $52 million in Liberty Bonds. He said several professional athletes including one New York Knick are among the investors. (Schwalb did not disclose the name, but said it was not U.S. Olympian Stephon Marbury).
Architects Beyer Blinder Belle and Gallagher & Associates are designing the museum space. Construction is expected to begin early next year and be finished in the summer of 2006.
Museum visitors will have a view of the “Canyon of Heroes” parade route and Schwalb expects to get crowds when New York sports teams win championships and drive up Broadway.
He said Downtowners should feel proud to have the “first, comprehensive, national sports museum in the entire country.”
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