New York Law School will receive $145 million in tax-free bonds to build classrooms and a library on the lot adjacent to their buildings.
Law school gets $145 million to build in Tribeca
By Ronda Kaysen
The city awarded a private law school $145 million in triple tax-free bonds to construct a new library and classroom building Downtown, allowing the school to funnel proceeds from the sale of its old library to its endowment, making it one of the largest in the country.
Last summer, New York Law School in Tribeca announced plans to sell the Mendik Law Library on Leonard and Church Sts. At the time, the school said it planned to use the proceeds from the sale as much as $122 million to construct a new five-story library and classroom building on the schools parking lot.
But in September, the school applied for $145 million in triple tax-exempt bonds to finance the new construction and last week the citys Industrial Development Agency approved the request. According to public records, the funds will be used to reimburse the school $4 million for purchasing a 10,000 sq. ft. residential building at 54 Leonard St., where it will build part of the new structure.
The bonds will also finance the demolition of 54 Leonard St., which currently houses at least three residential tenants.
One 54 Leonard St. resident declined to comment and attempts to reach the others were unsuccessful.
More than $116 million will be used for new construction. The new Smith Group-designed five-story building will also have four subterranean levels and include a library, classroom space, a cafeteria, common space and an auditorium. The school declined to release images of the new building, which will sit at 40 and 54 Leonard St.
In addition to the $145 million in bonds, the city waived a $4 million mortgage recording tax to offset financing costs.
New York Law School is a valuable asset for Lower Manhattan, Andrew Alper, chairperson of I.D.A., the issuing agency, said in a statement. The schools $145 million investment in Lower Manhattan is a terrific boost for the local economy.
The school is also selling air rights for the 12,500 sq. ft. Mendik Library, according to city records. A developer could build as much as 306,000 sq. ft. on the property that has no height restrictions, Woody Heller, a broker for the selling agent, told Downtown Express in July. Although the low-rise neighborhood is zoned for 120-foot height limits on new buildings, portions of the schools property avoided the restriction because of a community facilities provision.
Tribeca residents and Community Board 1 have long worried about how high the building will be.
The Law School is in negotiations with prospective buyers and referred all comments to Studley. Howard Nottingham, executive managing director of Studleys New York office, declined to comment.
With the new construction financed by tax-exempt bonds, the school will sink the proceeds of the Mendik sale into its endowment. Were hoping this could make us one of the best endowed law schools in the country, said Alta Levat, a spokesperson for the school.
The current endowment is $50 million. Tuition for full-time students is $38,600 a year.
The school has been struggling with space limitations for years. A deal with developer Shaya Boymelgreen to sell the entire Tribeca campus and relocate to the Financial District fell apart last year. Last May, New York Law School leased a 13-story dormitory building on E. Third St. to house 90 of its students. The Mendik sale and the construction of the new building will allow the 115-year old school to stay in Tribeca indefinitely.
Were trying to build a future for our law school in Tribeca, said Levat. Everybody here is really excited about this. We consider this a positive development for Tribeca.
In July, local residents balked at reports that the law school was opening the historic neighborhood to a high-rise development. News that the city plans to finance the new construction was not well received either.
Thats outrageous, said Carole DeSaram, chairperson of the Community Board 1s Tribeca Committee. Why should the taxpayers sponsor their endowment? Let them raise money like anybody else.
The city, however, insists the allocation is nothing out of the ordinary. We help a lot of private schools and not-for-profits in general, said Janel Patterson, a spokesperson for the Economic Development Corporation, which oversees I.D.A. Federal legislation allows that.