Los Angeles airports upgraded ahead of pricing
Los Angeles International Airport received a Moody's ratings boost ahead of plans to price $650 million to help fund its $11.9 billion capital program through 2024.
LAX's $3.4 billion in senior revenue bonds were upgraded by Moody’s to Aa2 from Aa3 Monday and $2.7 billion in subordinate revenue bonds upgraded to Aa3 from A1.
Moody’s also assigned its Aa3 rating to the 2018 Series D $483.3 million AMT subordinate revenue bonds and the Series E non-AMT $166.7 million subordinate revenue bonds the airport plans to price in coming weeks.
JPMorgan is lead manager. Loop Capital Markets and PNC Capital LLC are co-managers. PFM and Frasca & Associates LLC are financial advisers. Dentons is bond counsel.
Fitch Ratings affirmed its AA-minus rating Tuesday. Both ratings agencies assign a stable outlook to the Los Angeles airport enterprise's bonds.
S&P Global Ratings Tuesday affirmed its AA rating on the airport's senior-lien general airport revenue bonds and its AA-minus rating on the subordinate-lien GARBs. The outlook is stable.
“The ratings reflect superior credit characteristics including a strong underlying air trade service area, significant operational activity of 43.6 million enplanements supported by a diverse mix of domestic and foreign-flag carriers, favorable rate agreements with airlines and very strong financial metrics consistent with the AA category,” Fitch analysts said.
The upgrade to both ratings reflects the progress that Los Angeles has made in procuring large access modernization projects such as the automated people mover and consolidated rental car facility under fixed price contracts, and continued progress in keeping terminal renovation projects within program budgets, Moody’s analysts said in the report.