The Florida Housing Finance Corporation sold $170 million in bonds to finance affordable housing in the state.
The corporation sold the bonds in two series. The tax-exempt 2023 Series 3 bonds, consisting of $64 million, mature between 2024 and 2054, yielding between 3.35% and 5.75%. The taxable 2023 Series 4 bonds, consisting of $106 million, also mature between 2024 and 2054, yielding between 5.077% and 5.914%. The securities received a rating of Aaa from Moody’s Investors Service.
“The Aaa rating on the 2023 Series 3 and 2023 Series 4 bonds reflects [the] program’s continued sound financial performance and portfolio composition,” according to Moody’s.
The issuance follows the passage in March of the state’s $711 million plan to build more affordable housing. The legislation, which also offers interest free-loans to some homebuyers, was criticized for banning rent control as the state confronts a housing affordability crisis.
The corporation will use the proceeds from the sale of the bonds to finance the origination and securing of mortgage loans for low- and moderate-income homebuyers. In 2020, the corporation’s rental programs financed 17,602 affordable housing units, 99% of which were reserved for low-income households.
Still, the majority of Florida renters spent more than half their incomes on rent in 2021, according to a report by Apartment List, an apartment listing company. In 2022, the mayor of Miami-Dade County declared a state of emergency over the lack of housing affordability.
The bonds are limited obligations of the corporation, payable by its revenue.
Morgan Stanley & Co LLC served as lead underwriter on the issuance, purchasing the bonds for $172 million. The price reflected a premium of $2 million.