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NEW YORK CITY-The first residential project to go through New York City’s Housing Development Corp. for Liberty Bond funding was approved last week. HDC approved $82 million for a project at 90 Washington St. that is expected to have 368 studio and 30 one-bedroom apartments.

“Developers took their time. They have analyzed it to see what they could do,” explains Richard Bassuk, president of the Singer & Bassuk Organization and chairman and CEO of the Bassuk Organization. His company arranges debt and equity financing and provides consulting services for property owners. He is currently quarterbacking three Liberty Bond deals in the Lower Manhattan Liberty Zone.

All of his clients interested in utilizing the Liberty Bond program are those who have developed properties in Lower Manhattan previously, however many would not be doing it without the Liberty Bond incentive. “They are critical to the success of Downtown revitalization,” Bassuk believes.Lower Manhattan might take on a different look as developers are aiming to create communities, not just apartments, he says.”What’s good socially is good business. It takes a different kind of expertise to go from commercial to residential.” “They see realistic economic opportunity, have capital and experts to deal with complicated development scenarios.”

The federal government instituted the Liberty Bonds program after Sept. 11 to revitalize Lower Manhattan. The bonds are tax-exempt enabling developers to borrow at cheaper rates. The federal Liberty Bond program designated about $1.6 billion for residential construction. The city also approved $400 million in Liberty Bonds for 7 World Trade Center.

The program is not without its critics. At the May 5 public hearing held by the HDC, six groups from the Liberty Bond Housing Coalition testified against the first deal claiming that Federal resources earmarked for Lower Manhattan should not be used to develop luxury housing, particularly in the midst of a housing crisis. At least one developer, who is expected to receive Liberty Bond support, is paying the city a fee to enable the construction of luxury housing. That fee is said to be earmarked for affordable housing.

“It is appalling that the Mayor is retreating on his promise to rebuild Lower Manhattan as a dynamic mixed-income, mixed use community for all New Yorkers,” said Victor Bach, senior housing policy analyst at the Community Service Society. “In addition, HDC did not provide any evidence that the publicly-subsidized Liberty Bonds were necessary for this development, already under construction, to go forward.”

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