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Hudson Yards Makes Muni-Bond Market History for New York Agency

  • Subway agency sells its first bonds backed by rent payments
  • Future tenants include Time Warner, Neiman Marcus and KKR
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New York’s transit agency is cashing in on the massive development rising from an industrial landscape on Manhattan’s far west side.

The Metropolitan Transportation Authority, which typically uses fare-box revenue and bridge and tunnel fees to secure its debt, raised $1.06 billion Wednesday by selling its first bonds backed by real-estate. The securities will be repaid from money the agency receives from leasing land in Hudson Yards, a 26-acre site whose development has triggered a surge of construction in residential towers, office space and retail near the riverside west of Eighth Avenue.