The New York City Housing Development Corporation (HDC) sold more than $891 million in bonds to finance new housing projects.
The so-called sustainable development bonds were issued in three series. The 2023 Series A-1 bonds consist of $174 million and mature between 2026 and 2063. They have yields ranging from 3.1% to 5%. The 2023 Series A-2 bonds consist of $414 million and mature on May 1, 2063. About $260 million of those bonds yield 3.73%, and the remaining $160 million yield 3.7%. The 2022 Series G bonds consist of $53 million and mature between 2027 and 2032, with yields between 3.2% and 3.75%.
The HDC also issued two additional series of bonds: 2023 Series A-3 bonds consist of $75 million and pay interest at a variable rate, and 2023 Series B bonds consist of $175 million and carry interest at a to-be-determined term rate.
The 2023 Series A-1 and A-2 bonds and 2022 Series G bonds received a rating of AA+ from S&P Global Ratings and Aa2 from Moody’s Investors Service. The 2023 Series A-3 bonds received a rating of AA+/A-1+ from S&P Global Ratings and Aa2/VMIG 1 from Moody’s Investors Service. The 2023 Series B bonds received a rating of A-1+ from S&P Global Ratings and Aa2/VMIG 1 from Moody’s Investors Service.
The issuance comes as the city struggles to provide enough housing for its almost 9 million residents. The bonds will provide for the construction and rehabilitation of multifamily affordable housing in the city.
Homelessness in New York recently reached a level last seen during the Great Depression, according to the Coalition for the Homeless, an advocacy group. There were almost 69,000 homeless people in New York at the end of last year, and more than double the number of single homeless adults in the city than 10 years ago. About a third of those without homes are children.
The bonds will be backed by rent from the developments.
Barclays Capital Inc served as lead underwriter on the issuance.