DALLAS — Arizona tourist mecca Scottsdale expects to go to market Feb. 19 with $277 million of bonds in two deals.
The Phoenix suburb will refund $160 million of general obligation bonds that are rated triple-A across the board and nearly $117 million of excise-tax revenue bonds that fall one notch short of the top rating only from Moody's Investors Service.
The revenue bonds will bear the name of Scottsdale Municipal Property Corp.
Wells Fargo Securities is senior manager on the GO deal with Morgan Stanley. Stifel and Wedbush Securities are co-managers.
JPMorgan is book-runner and senior manager on the revenue bonds, with Baird and Morgan Stanley as co-managers.
Piper Jaffray & Co. is financial advisor, with Gust Rosenfeld as bond counsel.
Both issues are exempt from federal and state income tax, a status expected to appeal to Arizona's high-wealth individuals, many of whom live in Scottsdale.
With this issue, Scottsdale will have $619 million of general obligation debt and $519 million of municipal property corporation debt outstanding.
With a population of 224,800, Scottsdale's median family income in 2012 amounted to 147.5% of the U.S. median, according to Moody's. The per capita value of the tax base $191,422 is strong, in analysts' opinions.
Tourism is the city's top employer, as represented by several five-star hotels, spas and golf courses.
Despite its relative wealth, Scottsdale did not escape the deep impact of the 2008 recession.
Since 2010, population growth has been modest, increasing only about 3% to 224,800 residents, according to Census data.
After five years of consecutive declines, the city's full market value rebounded by 9.3% this year to $43 billion.
"Going forward, growth in taxable values will continue although likely at a pace that is somewhat subdued relative to neighboring municipalities as the city approaches build-out (2030) and developable land diminishes," according to Moody's analyst Dan Steed.
"The stable rating outlook primarily reflects Moody's expectation that the city's financial performance will maintain its strong general credit characteristics to ensure financial sustainability," Steed wrote, adding that it "also reflects our expectation that economic recovery in the region will continue at a more subdued pace over the near term."
