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Ohio State University Sells $377 Mln in Bonds

By Munichain News Desk

Ohio State University (OSU) issued $377.5 million in bonds to make improvements to its medical center and refund previously issued bonds.

The university sold the bonds in two series. The Series 2023 B bonds, consisting of $265.6 million, mature between 2024 and 2035, yielding between 2.98% and 3.39%. The Series 2023 C bonds, consisting of $111.9 million, mature between 2046 and 2056, yielding between 4.11% and 4.52%. The securities received a rating of Aa1 from Moody’s Investors Service, AA from S&P Global Ratings, and AA+ from Fitch Ratings.

“OSU continues to benefit from its position as a leading comprehensive flagship public research university with a strong regional and national draw,” Fitch analysts wrote. “Despite OSU’s sizeable ongoing capital plans, current debt issuance, and recent equity market volatility, the University retains a strong financial profile.” 

The issuance comes as the university gathers financing for an ambitious new hospital project.

The Series B bonds will finance the construction of a new, 820-bed inpatient hospital facility at OSU’s medical center. It will include “state of the art diagnostic, treatment and inpatient service areas,” according to the official statement accompanying the sale of the bonds. The hospital is slated to open in 2026 and cost almost $2 billion.

The Series C bonds will refund bonds issued in 2010, 2014, and 2016.

Located in Columbus, Ohio State is the largest university in the University System of Ohio and the third-largest in the United States. The bonds are special obligations of the university, payable by a lien on its general receipts, excluding some gifts and state appropriations.

RBC Capital Markets, LLC served as lead underwriter on the issuance, purchasing the bonds for more than $417 million. The price reflected an original issue premium of $41 million.

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