Those waiting for the bonds that will finance the long-awaited American Dream development in New Jersey will have to wait a bit longer as the big sale was delayed.

The deal, which had been tentatively slated for Wednesday, may be hitting the market on Thursday, according to a market source.

Goldman Sachs is the underwriter on the Wisconsin Public Finance Authority’s $1.1 billion of revenue bonds for the megamall project in East Rutherford, N.J. The PFA is issuing the debt on behalf of the New Jersey Sports & Exposition Authority, which operates the Meadowlands District where the project is located.

The issue consists of $800 million of limited obligation PILOT revenue bonds and $300 million of limited obligation grant revenue bonds.

The deal is not rated.

Secondary market
In secondary trading municipal bonds were stronger at mid-session, ahead of the Federal Reserve's monetary policy statement. Most market observers believe the Federal Open Market Committee will announce a 25 basis point interest rate hike.

The yield on the 10-year benchmark muni general obligation fell two to four basis points from 1.88% on Tuesday, while the 30-year GO yield dropped two to four basis points from 2.73%, according to a read of Municipal Market Data's triple-A scale.

The yield on the two-year Treasury fell to 1.29% from 1.36% on Monday, the 10-year Treasury yield dropped to 2.11% from 2.20% while the yield on the 30-year Treasury bond decreased to 2.78% from 2.86%.

On Tuesday, the 10-year muni to Treasury ratio was calculated at 85.2%, compared with 85.0% on Monday, while the 30-year muni to Treasury ratio stood at 95.4% versus 94.8%, according to MMD.

MSRB: Previous session's activity
The Municipal Securities Rulemaking Board reported 41,917 trades on Tuesday on volume of $7.98 billion.

Primary market
On Wednesday, Citigroup is set to price the Atlanta Development Authority’s $224 million of Series 2017 A-1 and A-2 senior healthcare facilities current interest revenue bonds for the Georgia Proton Treatment Center.

Since 2007, the Atlanta Development Authority has sold about $1.06 billion of securities with the most issuance occurring in 2015 when it sold $225 million.

The authority did not issue any bonds in 2008, 2011 or 2012.

Citi is also expected to price the city of Long Beach, Calif.’s $172 million of harbor revenue bonds.

The deal is rated AA by S&P Global Ratings and Fitch Ratings.

Bond Buyer reports 30-day visible supply
The Bond Buyer's 30-day visible supply calendar increased $213.3 million to $12.88 billion on Wednesday. The total is comprised of $5.04 billion of competitive sales and $7.83 billion of negotiated deals.

BlackRock: Bright summer for munis
Municipal bonds posted their sixth straight month of positive returns, according to BlackRock’s June 2017 municipal market update from the muni team of Peter Hayes, head of the municipal bonds group, Sean Carney, head of municipal strategy and James Schwartz, head of municipal credit research.

“Municipals posted a positive return in May as rates fell amid continued policy uncertainty in Washington, and supported by a favorable supply/demand dynamic,” said the report, which came out on Wednesday morning. “New issuance of $34.2 billion was down 19% versus last year and below expectations. At the same time, demand for the asset class remained firm and broad based.”

The firm, which manages $118 billion in municipal assets on behalf of clients, also said new issue supply was easily absorbed and, in fact, oversubscribed at an average rate of 4.5 times.

“Flows reflected a continued investor search for yield, with long-term and high-yield funds capturing the most assets.”

On the credit front, BlackRock said state income tax collections disappointed in April, as investors opted to defer declaring investment income in anticipation of lower tax rates.

“The weak collections exacerbate an already slow revenue growth trend and will likely test some states’ ability to balance their budgets before fiscal year-end (June 30 for most).”

The team also noted that investors remain yield-focused, favoring long-term and high-yield funds. BlackRock said it likes flexible strategies that can navigate rate and policy uncertainty.

The S&P Municipal Bond Index returned 1.32% in May and 3.49% year-to-date. Credit and long duration broadly outperformed as post-election fears continued to diminish and investors placed a premium on higher-yielding assets,” the report said.

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Chip Barnett

Chip Barnett

Chip Barnett is a journalist with more than 40 years of experience. Barnett is currently Senior Market Reporter for The Bond Buyer.
Aaron Weitzman

Aaron Weitzman

Aaron Weitzman is a markets reporter for The Bond Buyer, focusing on the sell side of the municipal bond market.