March 28 (Bloomberg) -- Nuveen Asset Management and other holders of almost $240 million of municipal debt issued to finance parking garages at the new Yankee Stadium agreed to waive declaring the bonds in default after the operator of the facilities consented to management changes.
Bronx Parking Development Co., a subsidiary of a nonprofit development agency, agreed to replace the management company overseeing the five garages, file monthly revenue and expense reports and add a board member approved by bondholders, according to a waiver agreement dated March 22.
The agreement between Bronx Parking and U.S. Bank National Association, the trustee that protects bondholders’ rights, also called for the operator to make “reasonable efforts” to get better signage on the Major Deegan Expressway, directing cars to the parking facilities, the waiver said.
Revenue from the garages and parking lots managed by the nonprofit is almost 40 percent below projections as the facilities face competition from public transportation and other parking at a mall near the stadium.
Bronx Parking is drawing on reserves to make a $6.9 million debt payment due April 1, according to Nuveen. It also has failed to maintain a debt-service coverage ratio of 1.15. The ratio, or the amount of cash available to meet annual interest and principal payments, is 0.56, according to Bronx Parking’s 2011 budget.
Nuveen, T-Rowe Price
John Miller, chief investment officer for Chicago-based Nuveen, which owned $116.5 million of the bonds at the end of February, couldn’t immediately be reached for comment. T-Rowe Price Group Inc. and a subsidiary of Aetna Inc. also owed some of the bonds as of Dec. 31, according to data compiled by Bloomberg.
William Loewenstein, president of the Community Initiatives Development Corp., the nonprofit parent of Bronx Parking Development Co., based in Hudson, New York, about 100 miles (160 kilometers) north of the Bronx, didn’t return a call seeking comment.
Steven Polivy, an attorney at Akerman Senterfitt LLP in New York, which represents Bronx Parking, also didn’t return a call.
Bronx Parking issued $237.6 million of municipal bonds in 2007 through New York City’s Industrial Development Agency to build three garages and renovate two others at the 50,287-seat stadium, home of the New York Yankees Major League Baseball team. The stadium, which opened in 2009, was built across the street from the original ballpark, where Babe Ruth once played.
The garages and parking lots managed by the nonprofit have generated 39 percent less revenue in the first nine months of 2010 than projected, according to financial statements.
As part of the waiver, Bronx Parking also agreed to provide bondholders with 13-week rolling cash-flow projections, monthly parking volume reports and hold monthly investor meetings.
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