If you've ever stayed at a hotel in New York City, you provided $1.50 to pay debt service for the Javits Center.
The New York Convention Center Development Corporation's bonds are funded by that Hotel Unit Fee surcharge on each night in a New York City hotel room.
The corporation hopes to get a boost from the strength of the city's tourism industry when it sells bonds this week.
Ahead of the deal, it received a boost from Moody's Ratings, which upgraded the senior-lien CCDC bonds to A1 from A2, and retaining a positive outlook.
"The outlook remains positive based on two consecutive years of above-trend pledged revenue growth that has been bolstered by a 2025 law allowing HUF to be levied on short-term rental units such as Airbnbs and Vrbos," Moody's said May 22.
The deal, set to price on Tuesday, consists of $436.64 million of refunding senior lien bonds, sold across two tranches. The first tranche, $382.275 million of Series 2026A, will refund part of a series from 2015. The second, $54.365 million of Series 2026B, are forward delivery bonds which will refund some outstanding 2016A bonds.
Series A will amortize from 2027 through 2045; Series B, from 2027 through 2046. Wells Fargo Securities is the bookrunning senior manager for the deal, with ten co-managers. Nixon and Peabody is the deal's counsel and Public Resources Advisory group is its financial advisor.
The bonds are secured by a senior lien on the hotel unit fee of $1.50 per day within New York City.
The bonds are also backed by a State of New York Mortgage Agency senior lien credit support agreement to pay up to one third of scheduled senior lien debt service. The bonds also have a cash funded debt service reserve fund and a senior lien revenue account funded at 80% of senior lien maximum annual debt service.
"Under Governor Hochul's leadership, New York City's tourism economy has made a strong post-pandemic recovery," Empire State Development said in a statement, "with robust growth in hotel unit fee revenues helping support NYCCDC's upgraded A1 credit rating and positive outlook."
Moody's kept its positive outlook in part due to "the introduction of HUF on short-term rentals, which may support above-trend pledged revenue growth and strengthen aggregate debt service coverage over the next 18-24 months."
The CCDC was formed in 1979 by Empire State Development to issue bonds for the construction of the Javits Center. Empire State Development and the Triborough Bridge and Tunnel Authority each own 50% of the CCDC.
The 2015 and 2016 bonds financed the
The CCDC has roughly $900 million of bonds outstanding, according to Moody's; $707 million of that debt is senior lien bonds. This is the CCDC's first deal in more than a decade.
Moody's rates the subordinate lien bonds one notch lower, at Baa1 with a positive outlook. They have lower coverage, revenue strain because of the senior lien bonds, and an "escalating debt service schedule," the rating agency said.
The CCDC's hotel use fees have faced pressures since 2019; first, from the COVID-19 pandemic, then from New York City's use of hotels to house immigrants.
Total receipts from the HUF fell to $19.5 million in the bond year ending Nov. 15, 2021, from $52.6 million in 2019, the last full year before the pandemic, according to the preliminary official statement for the deal.
But 2025's $54.16 million of collections were the highest ever for the fee, according to the POS.
"In bond year 2025, pledged HUF grew 9% above the prior year, surpassing pre-COVID levels and fully covering aggregate debt service for the first time since 2019," Moody's wrote. "In addition, with the help of interest earnings and accumulated excess revenue, NY CCDC has fully replenished the senior revenue account and subordinate revenue account, two years ahead of earlier estimates."
Moody's is the only agency hired to rate the bonds. The history of the rating reflects the rough waters created by the COVID-19 pandemic.
Entering the pandemic, the senior bonds were rated Aa3 with a stable outlook.
In March 2020, as the pandemic set in, the outlook dropped to negative. In October 2020, Moody's cut the rating to A1 and kept the negative outlook; in September 2021
As the hotel business recovered, Moody's lifted the outlook to stable in August 2023, and lifted the outlook to positive in October 2025.
HUF receipts for 2026 so far are running 9.5% above 2025, according to the POS, but the financing is structured based on projected growth of 1% to 1.5% growth in the years after 2027, the POS said.
The New York City hotel market is the strongest in the United States, according to Moody's. Occupancy rates were 85% in 2025, compared to 67% for the next 22 largest US hotel markets, Moody's wrote.
Moody's analysts expect that hotel unit fees will see steady long-term revenue gains, due to the "size, diversity and long term growth of New York City tourism and business travel market."
Because the fee is fixed, it's not subject to room rate fluctuations for the city's hotels, Moody's added.
The CCDC also expects strength for its HUF revenue. An analysis from Illinois consulting firm HVS expects the occupancy rate of NYC hotel rooms to drop slightly but hold at 82%, and the fee revenue to increase to $80 million by 2056.
If the projections are wrong and fee revenue drops, the CCDC has roughly $78 million in its senior lien funds to cover debt service.
Since President Donald Trump began his second term with an immigration crackdown, international tourism to the U.S. has declined.
In 2025, foreign visits to New York City were down 400,000 year-over-year to 12.5 million, according to the online investor presentation for the deal, but domestic visits were up by 800,000, to 52.4 million.
The 2026 soccer World Cup, which kicks off June 11, had been touted as a boom for the hotel business. Eight matches, including the final, are scheduled for MetLife Stadium, across the Hudson River from Manhattan.
But New York, like many other cities in the U.S., has seen lower-than-expected hotel demand from the FIFA World Cup.
In a survey of hotel operators by the American Hotel & Lodging Association, roughly two-thirds of New York City respondents
New York saw a 3.1% decline in international travel, according to Moody's, but the slump was "more than offset" by growth in domestic travel. So far in 2026, the city has seen a 2.1% increase in tourism, Moody's said.
