Three of the week's five largest issuances will hit the market on Tuesday, giving traders options as to where to burn their calories. While most municipal buyers won't be able to participate, the Three World Trade Center Tower Project deal will be the market's primary focus, a mammoth $1.63 billion unrated deal open only to qualified investment buyers.
Primary
- Goldman, Sachs & Co. will lead the Three World Trade Center Tower Project issued by the New York Liberty Development Corp. The unrated deal comes in three long-dated maturities: the $1.080 billion Class One tranche maturing in 2044, the $300 million Class Two tranche maturing in 2041, and the $250 million 2044 Class Three tranche maturing in 2044, according to bond documents. The bonds are secured by a mortgage on the building, tenant leases and rents. While most municipal investors won't be able to purchase the debt - it requires all buyers to be qualified investment buyers - the deal will steal the spotlight as traders watch closely for price discovery. Initial price talk has been virtually nonexistent, said multiple traders, as the lead manager, Goldman, typically plays pricing on its deals "close to the vest."
- A distant second in size, Goldman will price a $350 million taxable California Earthquake Authority revenue bond. The deal is unrated.
- Also in the negotiated market, Morgan Stanley will price a $204.715 million healthcare revenue bond deal issued by the Southcentral Pennsylvania General Authority. The debt will go to finance the WellSpan Health Obligated Group and is rated Aa3 by Moody's Investors Service.
All data provided by Ipreo and TM3.
Secondary
Secondary trading was light on Tuesday morning as traders waited for the primary market results to lead directionality and value strategy.
Scales
In advance of the primary volume, the Municipal Market Data's triple-A 5% scale held steady in the intermediate to long end of the curve, according to data provided by TM3. Yields on bonds maturing between 2020 through 2044 were unchanged and those maturing between 2015 through 2019 were under review.
