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New York Issues $2.5 Billion in Airport Bonds

By Munichain News Desk
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The New York Transportation Development Corporation sold $2.55 billion in bonds to finance a new terminal project at John F. Kennedy International Airport.

The bonds mature between 2037 and 2060, yielding between 3.87% and 4.84%. They received an insured rating of AA+ from Kroll Bond Rating Agency, A1 from Moody’s Investors Service, and AA from S&P Global Ratings. They received an uninsured rating of BBB- from Kroll, Baa3 from Moody’s, and BBB- from Fitch Ratings.

The rating reflects “the high development costs, construction constraints and interface challenges associated with the construction of the New Terminal One,” Moody’s analysts wrote.

The $9 billion first phase of the project to build the terminal is the largest single-asset project financing in U.S. history, according to the group developing it.

The airport will use the bond proceeds to finance the $19 billion New Terminal One project, which will see a terminal replaced by a new, “world-class” facility. The bonds will also finance the demolition of an existing terminal, parking garage, and other infrastructure. The new terminal is scheduled to open in 2026.

The bonds are special and limited revenue obligations of the New York Transportation Development Corporation, payable by certain airport revenue. The airport is managed by the Port Authority of New York and New Jersey.

BofA Securities, Inc served as lead underwriter on the issuance, purchasing the bonds for $2.65 billion. The price reflected a premium of $117.9 million and a discount of $13 million. Frasca & Associates, LLC and Samuel A. Ramirez & Co, Inc acted as financial advisors.


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