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Ground broken for Brooklyn's Renaissance Plaza.

Ground was broken on October 11th for the construction of Brooklyn Renaissance Plaza, a 31-story building that will includes a 384-room hotel development on a City-owned site in downtown Brooklyn.

Empire Insurance Group, a subsidiary of Leucadia National Corporation, will be a major tenant in the new office building, keeping its 736 jobs in New York City and creating a projected 50 new jobs over the next 20 years.

Located on the block bounded by Johnson, Jay and Adams streets, Renaissance Plaza will include 809,280 square feet of office space, a full-service Marriott hotel and banquet center, retail shops, a health club and a 1,074-car private parking garage. Renaissance Plaza is being developed by the Brooklyn Renaissance Plaza, LLC, whose members include affiliates of Muss Development Company of Forest Hills, Leucadia National Corporation and The Carlyle Group. Together, Empire and Renaissance Plaza will account for a total of 1,236 jobs for the City (736 at Empire; 400 at the hotel; and 100 at the garage/office building).

Mayor Rudolph Giuliani said, "The birth or the Renaissance Plaza project will result in a world-class office complex and hotel and more jobs for New Yorkers. Moreover, Empire's decision to become a major tenant demonstrates the attractiveness of downtown Brooklyn as a place to do business. We are very glad we've been able to retain this important company and we congratulate Empire officials on their decision to stay in New York City as a tenant at Renaissance Plaza."

Empire's decision to become a tenant at Renaissance Plaza was made after the company decided against a move to Valley Forge, Pa., where it planned to consolidate its operations with another Leucadia subsidiary, Colonial Penn Insurance. Empire will rent nine floors in Renaissance Plaza. The King's County District Attorney's Office, which has occupied its current Brooklyn offices for more than 60 years and is in need of expanded, upgraded space, will lease 14 floors. The hotel is seven floors, and Brooklyn Union will share one floor.

The City's agreement with the developer, negotiated through the New York City Economic Development Corporation (EDC), projects construction of Brooklyn Renaissance Plaza to cost $228.3 million. The City will contribute up to $27 million for tenant improvements to the District Attorney's space and up to $23.35 million toward the construction of the base building and gage. The City will also contribute $1.5 million for street improvements on Adams Street. At the same time, Renaissance Plaza is expected to generate $306 million in economic activity per year and as much as $9.9 million per year in tax revenues.

The Marriott will be the first new hotel in Brooklyn in 50 years, and the office tower is Brooklyn's first in four years. The project will also provide 800 construction jobs over a two-year period.

The terms of the agreement with Empire Insurance Company were also negotiated through the New York City Economic Development Corporation (EDC) and approved by the City's Industrial Development Agency (IDA). Empire, currently located at 122 Fifth Avenue and four other smaller midtown Manhattan locations, will receive a maximum of approximately $8.4 million in State and City sales tax and real estate tax benefits in connection with its commitment to retain 736 jobs. The City's portion of this benefits package is $5.4 million. The City is also offering an additional maximum benefit of $300,000 if Empire is able to create the projected 50 new jobs. Empire generates $7.7 million annually in City tax revenues. As a result, the payback period is 8.9 months.

Including this agreement, the Giuliani administration has now retained 21 major companies, representing 49,902 jobs retained and a projected 17,096 new jobs over the next 20 years through its corporate retention program. The total tax revenue generated by these companies to the City is $738.5 million a year for the next 10 to 20 years.

Morse Diesel International has been chosen as the contractor and has already begun construction of Renaissance Plaza. The project is expected to be completed within the next 23 months. William B. Tabler Architects, which has designed more than 300 hotels, created the hotel design.

Brooklyn Renaissance Plaza, LLC, (BRP) will own the office/garage portion of the project. BRP is composed of MWR Associates, LP, with Muss Development Co. as its general partner; TCG Realty, LLC, the real estate subsidiary of The Carlyle Group, a Washington, D.C.-based merchant bank; and Luk-Ren, a wholly-owned subsidiary of Leucadia National Corp., an insurance, finance and real estate holding company. BRP Hotel, LLC, will own the hotel portion of the project and includes the above partners, as well as an affiliate of Marriott International Corporation.
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Title Annotation:31-storey office building in New York City's Brooklyn District
Publication:Real Estate Weekly
Date:Oct 23, 1996
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