New York’s Wildlife Conservation Society will go to market on Thursday with an $89 million sale of Series 2013A revenue bonds by negotiation, issued through New York City’s Trust for Cultural Resources.
Meanwhile, the society said Tuesday it would partially reopen its hurricane-damaged New York Aquarium in Brooklyn in late spring. According to Standard & Poor’s, the aquarium accounts for about 16% of the society’s net in-park earned revenue and 5% of expenses.
Goldman, Sachs & Co. is lead manager for the bond sale. Moody’s Investors Service and Standard & Poor’s rate the bonds Aa3 and AA-minus, respectively, both with stable outlooks.
The society manages the aquarium and four zoos, including the Bronx Zoo, athrough an agreement with New York City’s Department of Cultural Affairs. It plans to use the proceeds from Thursday’s sale to refund $65.5 million of Series 2004 bonds, fund $20 million worth of renovation projects at the Bronx Zoo and fund $3 million for three years of capitalized interest. A general obligation of the society secures the bonds. Maturity runs from 2023 to 2042.
The Bronx Zoo project calls for $59 million in spending through fiscal 2017. Originally, according to Standard & Poor’s, the 2012 project component of the master plan had two components: a $147 million expansion of the aquarium and infrastructure improvements and exhibit renovations at the zoo.
Hurricane Sandy, however, struck on Oct. 29 and damaged the aquarium, located at Coney Island along the Atlantic Ocean. The society’s “rough estimate” for the cost of full restoration is about $65 million, it said Tuesday, although insurance and the federal government may cover some of that.
The society had originally planned a $112 million issue for the last week of October that included financing for aquarium renovations, but the deal was among the many pulled from the calendar as Sandy approached New York.
“We believe that management acted swiftly and prudently to assess damages and plan for the restoration,” Standard & Poor’s said. “However, we believe that operational risk exists in that restoration costs, anticipated receipt of funds and repair timetables are only estimations at this point.”
Moody’s based its rating on the society’s market strength, long-range planning, diverse revenue sources, liquidity and debt-coverage strength. But it also cited thin operating performance, Sandy-inflicted operating deficits, the complexity of its international work -- the society says it manages conservation projects in 60 counties -- and “investment manager concentration risk.”
Orrick, Herrington & Sutcliffe LLP is bond counsel. Hawkins Delafield & Wood LLP is representing the underwriters. Patterson Belknap Webb & Tyler LLP is representing the society, while Bryant Rabbino LLP is representing the trust.