New York City plans to sell $300 million of fixed-rate general obligation bonds next week with a two-day retail order period beginning on Tuesday. Institutional pricing will begin on Thursday, Oct. 16.
Morgan Stanley will serve as book running senior manager, and Citi, JPMorgan and Merrill Lynch & Co. will serve as co-senior managers. Sidley Austin LLP is bond counsel. Public Resources Advisory Group and A.C. Advisory Inc. are financial advisers. The bonds' structure has yet to be determined.
The deal comes at a time when the few large New York issues are being marketed and yields have been volatile. For the past year, the city has generally used three-day retail order periods on its bonds, but next week's retail will be two days.
"It's a smaller deal size and in the current market we think two days will probably be enough to get the retail orders that are out there," said Carol Kostik, deputy city comptroller for public finance.
Last week the city cut back a two-day retail order period on $300 million of Transitional Finance Authority building aid revenue bonds to one day in the face of strong retail demand.
Joseph Darcy, senior portfolio manager at Dreyfus Corp., said that if conditions this week stay in place next week, there should be good demand for the bonds.
"It's very difficult in this environment to forecast a day forward much less a week forward," Darcy said. "Certainly you've got a widely recognized, attractive issuer that's coming at a time when yields have gone through a significant adjustment and retail is demonstrating a formidable appetite for bonds."
Standard & Poor's assigns the city its AA rating and Moody's Investors Service rates the city Aa3. Fitch Ratings rates the city AA-minus.