Even as the approaching holidays are expected to put a seasonal damper on primary market supply, New York's Liberty Development Corp. plans to begin marketing $2.59 billion of escrow bonds tomorrow to meet a year end deadline to sell Liberty bonds for redevelopment of the World Trade Center site.
The large New York offering brings estimated volume this week to $2.82 billion, according to Ipreo LLC and The Bond Buyer.
Last week, issuers brought more than $4.32 billion of bonds to market, according to Thomson Reuters.
The Liberty Development Corp. bonds will be marketed to institutional investors in two series. A retail order period is not planned. Goldman, Sachs & Co. is underwriting the bonds and Winston & Strawn LLP is bond counsel.
The bulk of the issue, $2.58 billion, will be offered tomorrow as Series 2009A term rate bonds and the proceeds will be invested in U.S. Treasuries.
The bonds will be sold initially as a term bond with a 2049 maturity, subject to mandatory tender. The proceeds will be used to purchase Treasury State and Local Government Time Deposit Certificates of Indebtedness or other Treasury certificates sufficient to pay interest on the bonds due July 1, 2010.
They will also purchase Treasury State and Local Government One-Day Certificates of Indebtedness Demand Deposit sufficient to pay principal and interest on the bonds during a mandatory tender period from Oct. 12, 2010, to Jan. 11, 2011.
Fitch Ratings assigned its AAA/F1-plus rating to the bonds, citing the legal structure and security of Treasuries. Moody's Investors Service rates the bonds Aaa.
The Series 2009B bonds will be marketed as variable-rate bonds at a par of $12.5 million, subject to change, on Dec. 29 and will be backed by an irrevocable direct-pay letter of credit from JPMorgan Chase Bank NA
The Series B bond proceeds will be deposited into a capitalized interest account. Fitch rates the bonds AA-minus/F1-plus based on the LOC. Moody's rates them Aa1/VMIG1.
A $157.2 million sale of marine terminal revenue bonds from the South Jersey Port Corp. will include $129.8 million of taxable Build America Bonds maturing from 2018 to 2021 with term bonds in 2029 and 2040; $23.5 million of tax-exempt bonds maturing 2013 through 2017 with term bonds in 2022 and 2024; and $4.9 million of traditional taxable bonds maturing in 2012 and 2013.
The deal will be priced by Raymond James & Associates Inc. tomorrow, after a retail order period today on the tax-exempt series, and taking indications of interest today as well on the remaining series.
The South Jersey Port Corp. bonds are rated A1 by Moody's Investors Service and A by Standard & Poor's.
One of the only other sizable deals listed on the negotiated calendar is a two-pronged deal from the California Pollution Control Finance Authority totaling approximately $43 million.
The sale, which is being priced by Walnut Creek, Calif.-based Westhoff Cone & Holmstedt tomorrow, consists of weekly, variable-rate bonds with a final maturity in 2039.