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Governor George E. Pataki and Mayor Michael R. Bloomberg today announced plans by Goldman Sachs to build the first new headquarters building Downtown in 16 years. The new $1.8 billion, high tech, environmentally efficient headquarters will be located on Site 26, the last remaining commercial parcel at Battery Park City.
Governor Pataki and Mayor Bloomberg noted that Goldman Sachs has agreed to maintain New York City employment at least equal to its current total of 9,178 when it occupies its new building in 2009-2010. The firm also projects the creation of approximately 4,000 jobs by 2019.
The company will maintain this employment level, along with its headquarters and investment banking and trading operations, through at least 2028. Approximately 7,400 jobs will be located in the new headquarters building.
"Today's commitment by Goldman Sachs to invest nearly $2 billion and create thousands of new jobs at Battery Park City marks another major step forward in our efforts to revitalize and bring jobs back to Lower Manhattan," Governor Pataki said. "I commend Goldman Sachs for its decision to build a new headquarters facility in the New York's financial district, further enhancing the city's reputation as the world's financial capital.
"The decision by Goldman Sachs to invest almost $2 billion in a new headquarters building in Battery Park City is proof positive of the growing confidence of the financial services sector in the revitalization of the City and Lower Manhattan," said Mayor Bloomberg. "The firm's creation of a state-of-the-art trading facility and its expectation of adding thousands of jobs over the next 15 years speaks volumes to the progress we're seeing everyday."
The new building will comprise approximately two million square feet. It will be state-of-the-art and house headquarters and front office staff, including investment banking, commodities trading and related operations.
Henry M. Paulson Jr., chairman and CEO of Goldman Sachs, said, "We are delighted to reaffirm our 135 year old commitment to downtown Manhattan. We also want to commend the Governor and the Mayor for their efforts in revitalizing our neighborhood and we look forward to welcoming them to our new building."
This is the first headquarters project to be built in Lower Manhattan since 1988 when JP Morgan built a facility at 60 Wall St. Charles A. Gargano, chairman of Empire State Development Corp., said, "Goldman Sachs is making a tremendous investment in New York and providing an outstanding opportunity for our workforce. This project illustrates a
continued confidence in the New York economy and the business climate we have created."
"This fantastic project is exactly what the Liberty Bond program was created for," said Deputy Mayor Daniel L. Doctoroff. "With the City, State and Federal governments working with leaders of New York City's financial community, we are making great strides toward full economic recovery. I thank the people of Goldman Sachs for their continued support and their recognition of the fact that New York City remains the heart of the world's financial community."
Both the state and city are providing financial support towards the $1.8 billion project cost. A total of $1 billion in development cost is expected to be financed through the Liberty Bond program, a joint City-State financing program. The bonds are issued by the New York Liberty Bond Development Corp., which approved an inducement resolution for the project today.
Goldman Sachs is negotiating a ground lease for the site through 2069 with the Battery Park City Authority. The ground lease is expected to provide for up to $13.4 million NPV in sales tax exemptions to be earned through job growth in excess of 9,413 jobs, as well as a program of payments in lieu of real estate taxes offering real estate tax savings similar to those available on an as-of-right basis to other developers of commercial facilities on eligible privately-owned sites in Lower Manhattan.
Goldman Sachs will also be eligible for Con Edison Business Incentive Rate energy discounts worth an estimated $10.3 million NPV over 15 years for use at all of its Lower Manhattan facilities.
In addition to the building project, Goldman Sachs is eligible to apply for up to $25 million in Job Creation and Retention Program (JCRP) grant funds based on the retention of a minimum of 8,100 jobs and the creation of 800 new jobs in Lower Manhattan over the next five years.