The Atlanta Braves $672 million, 41,500-seat stadium in Cobb County will open in time for the Major League Baseball season in 2017.

BRADENTON, Fla. - Cobb County, Ga., plans to competitively bid $372.55 million of AAA-rated taxable bonds on Tuesday to finance the Atlanta Braves' new stadium.

The fixed-rate, 30-year bonds are being issued by the Cobb-Marietta Coliseum & Exhibit Hall Authority through an interlocal agreement with the county.

Bond proceeds will be used as the county's contribution to a $672 million, 41,500-seat Major League Baseball stadium.

Bids will be taken at 10:30 a.m. eastern on Ipreo's Parity electronic bidding platform.

"We expect strong bids as a result of the triple triple-A ratings based upon the county's full faith and credit pledge to the intergovernmental contract securing the bonds," financial advisor Dianne McNabb, a director at Public Financial Management Inc., said in an interview Friday.

The deal was preliminarily structured with serial bonds with an option to allow bidders to combine between two and eight consecutive maturities as a term bond.

However, the term bond option was revised on Friday to allow any two or more consecutive maturities to be designated as a term bond.

McNabb said the change was made after PFM received inquiries from underwriters who wanted to make the issue eligible for Barclays Index. The index listing would increase liquidity and demand, she said.

"Right now we would estimate a true interest cost just below 4%," McNabb said. "It's a large deal but the county has consistently been committed to the competitive market for 20 years, and has been very successful in all their prior offerings regardless of size."

A good deal of interest in the bonds is also anticipated because there currently is limited supply of Georgia paper, which is "very much in demand," she said.

The deal is structured to achieve level debt service, and includes an optional 10-year call provision, said Jim Pehrson, director of finance and economic development for Cobb County.

"We were fortunate enough to have sufficient cash flow to cover the construction period, and we're able to finance the debt service with the revenues that are coming in," he said.

While the initial plan of finance called for capitalized interest, Pehrson said that was eliminated in the current structure because the Braves covered cash-flow needs in the early stages of construction. It also lowered the overall cost of financing, he added.

Construction of the stadium is well under way, but the bond issue had been delayed by litigation over validation of the bonds by a Georgia court.

The validation was upheld by the Georgia Supreme Court on June 29, clearing the way for the bonds to be sold.

McNabb said PFM worked with the county to develop a conservative structure that is not expected to depend on future increases in property values or sales.

Under the terms of the intergovernmental agreement, the county has agreed to make "absolute and unconditional" payments as long as the bonds are outstanding. The county has also pledged to levy an ad valorem tax, if necessary to fund debt service.

The county plans to use several different sources of revenue to pay debt service, including existing hotel/motel and rental car taxes, revenues from a tax district, and license fees from the team.

The Atlanta Braves will move from Turner Field in downtown Atlanta to the new stadium in southeastern Cobb County. The stadium is expected to be complete by opening day of the 2017 season. The team has cut a deal with SunTrust Bank for naming rights.

An adjacent $400 million mixed-use development financed by the team is also expected to open at the same time.

 

 

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