The Trust for Cultural Resources of New York City last week sold $22 million of revenue refunding bonds, with Goldman, Sachs & Co. serving as senior manager.
Roughly $6.04 million of the bonds were structured as serials with maturities in 1992 through 2004, and priced to yield 4.65% to 6.50%. About $16 million of the bonds were structured as term bonds, with $5.8 million maturing in 2011 and priced to yield 6.68%, and $10.6 million due in 2019 and priced to yield 6.83%. The entire issue was insured by AMBAC Indemnity Corp.
An officer with Goldman Sachs said the bonds were sold to a "good mix" of retail and institutional investors, including bank trust departments and bond funds.
The proceeds from the issue will be used to refund the collateralized revenue bonds series B, sold by the trust fund in 1984 for the Museum of Modern Art. The series B bonds will be called Jan. 1, 1994.
To increase gallery space, public service facilities, and restaurant and retail space, proceeds from a 1979 series A and the 1984 issues were used to partially finance the construction of the six-story West Wing facility adjacent to the main building of the museum, located on 53 Street in Manhattan. Proceeds were also used to finance the renovation and improvement of the main building.
The 1991 A bonds are a general obligation of the museum, subject to certain restrictions, such as the museum building and its art collection, according to a preliminary official statement. The bonds are not obligations of the city and the state.
The refunding bonds will also be secured from what is left of tax equivalency payments to the trust fund after payments are made to cover other expenses. The tax is paid by the owners of condominiums in a 44 story residential tower constructed over the West Wing of the museum.
An agreement with the city stipulates that the towers, which was not financed with any of the previous bond sales for the museum, is not subject to real estate taxation. The 6 condominium owners, however, are required to make the equivalency payments.
The trust fund, established in 1976 as a corporate governmental agency and public benefit corporation, was created to assist participating cultural institutions in the city with the development of their unused or underutilized property.
It has also sold bonds to finance television facilities for the Educational Broadcasting Corp., a new facility for the Museum of Television and Radio, and separate bond issues to finance the renovation of Carnegie Hall, the Solomon R. Guggenheim Museum, and the American Museum of Natural History.