The permanent financing utilized auction rate tax-exempt bonds issued by the New York State Housing Finance Agency under its 80/20 program--which mandates a 20% affordable-housing component and 80% market-rate units--with such bonds credit enhanced by Wachovia Multifamily Capital Inc. under Fannie Mae's permanent credit enhancement financing program. "The use of auction rate low-floater bonds, rather than the more traditional variable rate low-floater bonds, enabled the Borrower to achieve greater proceeds at a lower interest rate," Bassuk says, adding that this is only the fifth time auction rate bonds have been used to provide permanent financing for a large multifamily project.

Bassuk notes that the complex structure was required in light of the increase in value of the project since construction and Moinian's desire to monetize the appreciation in project value in order to obtain $20 million of proceeds in excess of the initial construction financing. The Marc is located on a full block-front along Eighth Avenue between 53rd and 54th streets. It features an 80,000-sf garage and 9,357 sf of retail space.