CLEVELAND, June 10 /PRNewswire-FirstCall/ -- Forest City Enterprises, Inc. (NYSE: FCEA and FCEB) today announced that a subsidiary has closed on the conversion of the construction facility for the East River Plaza retail center in Manhattan, to a $214.3 million ($107.2 million at the Company's pro-rata share) term loan.
The conversion to permanent financing, with maturity in January 2019, is through the same lender group that provided construction financing for the center. The loan carries an effective all-in fixed interest rate of less than 4.5 percent. The major financial terms of the conversion were negotiated in conjunction with the initial construction loan. Coupled with the conversion of the construction loan, the existing $40 million credit enhancement in tax-exempt Empowerment Zone bonds has also been extended to the 2019 maturity date. In addition to conventional bank financing, the center was made possible by financing provided by the State of New York, New York City and the Upper Manhattan Empowerment Zone.
"This is a great outcome for East River Plaza and for the public/private partnership that made it possible," said Charles A. Ratner, Forest City president and chief executive officer. "We appreciate the continuing support and commitment of our lenders in executing this conversion. I also want to acknowledge the work of our Forest City Ratner team and our joint venture partner, Ed Blumenfeld and his team, in closing this conversion and in making the overall project to date a great success."
East River Plaza is a 527,000-square-foot retail center built on the site of the former Washburn Wire factory in Harlem. The factory stood vacant since the early 1980s prior to the beginning of work on the retail center. The site was initially acquired by Blumenfeld Development Group, Ltd., a full-service real estate development firm with core strengths in big-box retail and office space.
In November 2009, Costco became the first tenant to open at East River Plaza. Since then, Best Buy also opened, and additional tenants, including Target, Marshall's, PetSmart, Old Navy, Bob's Furniture and GameStop are expected to open this summer. The center is currently 93 percent leased.
About Forest City
Forest City Enterprises, Inc. is an $11.5 billion NYSE-listed national real estate company. The Company is principally engaged in the ownership, development, management and acquisition of commercial and residential real estate and land throughout the United States. For more information, visit www.forestcity.net.
Safe Harbor Language
Statements made in this news release that state the Company's or management's intentions, hopes, beliefs, expectations or predictions of the future are forward-looking statements. The Company's actual results could differ materially from those expressed or implied in such forward-looking statements due to various risks, uncertainties and other factors. Risks and factors that could cause actual results to differ materially from those in the forward-looking statements include, but are not limited to, the impact of current lending and capital market conditions on its liquidity, ability to finance or refinance projects and repay its debt, the impact of the current economic environment on its ownership, development and management of its real estate portfolio, general real estate investment and development risks, vacancies in our properties, further downturns in the housing market, competition, illiquidity of real estate investments, bankruptcy or defaults of tenants, anchor store consolidations or closings, international activities, the impact of terrorist acts, risks associated with an investment in a professional sports team, its substantial debt leverage and the ability to obtain and service debt, the impact of restrictions imposed by its credit facility and senior debt, exposure to hedging agreements, the level and volatility of interest rates, the continued availability of tax-exempt government financing, the impact of credit rating downgrades, effects of uninsured or underinsured losses, environmental liabilities, conflicts of interest, risks associated with the sale of tax credits, risks associated with developing and managing properties in partnership with others, the ability to maintain effective internal controls, compliance with governmental regulations, increased legislative and regulatory scrutiny of the financial services industry, volatility in the market price of its publicly traded securities, litigation risks, as well as other risks listed from time to time in the Company's SEC filings, including but not limited to, the Company's annual and quarterly reports.
SOURCE Forest City Enterprises, Inc.