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DC Airports Issue $824 Million in Bonds

By Munichain News Desk

The authority that manages two of the three major airports near Washington, DC sold $823.6 million in bonds to finance capital projects and refund previously issued securities.

The Metropolitan Washington Airports Authority’s (MWAA) bonds mature between 2025 and 2054, yielding between 3.81% and 4.3%. They received a rating of AA- from Fitch Ratings, Aa3 from Moody’s Investors Service, and AA- from S&P Global Ratings.

The rating reflects the authority’s “very strong credit attributes, including the resilience of its complementary dual-large hub airport system serving the strong and growing District of Columbia air trade service area; well-balanced system-wide carrier mix; capital program progression at both airports; and its stable financial profile,” Fitch analysts wrote.

This issuance follows a banner year at the authority’s airports, Dulles International Airport and Reagan National Airport. Traffic at the airports surpassed prepandemic levels and ratings agency expectations. (The authority does not manage Baltimore/Washington International Airport.)

The authority will spend $395 million of the bond proceeds on projects including the construction of a new concourse at Dulles, which is estimated to cost $749 million and open in 2026, according to the official statement accompanying the sale of the bonds. The proceeds will also support $140 million worth of terminal renovations at Reagan, where a new, $362 million concourse opened in 2021.

MWAA will use an additional $442 million of the proceeds to refund bonds that it sold in 2014 and 2015.

The bonds are limited obligations of the authority, payable by its net revenue. MWAA forecasts that it will collect $669.1 million in net revenue this fiscal year, according to the bond documents.

BofA Securities, Inc served as lead underwriter on the issuance, purchasing the bonds for $880.7 million. The price reflected a premium of $59.1 million and a discount of $2 million. Frasca & Associates, LLC acted as financial advisor.

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