The University of Virginia plans to bring $235 million of revenue bonds to market today in a negotiated sale with triple-A ratings from all three major rating agencies.
The bond proceeds will finance construction projects throughout the university, including parking garages and a research center. A portion of the funds will refinance about $5.8 million of outstanding debt.
Morgan Stanley is underwriter on the deal. Prager, Sealy & Co. is financial adviser. McGuireWoods LLP is bond counsel.
Standard & Poor’s, Moody’s Investors Service, and Fitch Ratings all give the deal triple-A ratings with a stable outlook.
According to Standard & Poor’s, the rating reflects the university’s general revenue bond security supported by an impressive demand for undergraduate, graduate, and professional academic programs; a sizable long-term investment pool of about $4.4 billion, which includes endowments; and a strong level of unrestricted net assets, which equaled 80% of adjusted operating expenses at June 30, 2007.
Both Fitch and Standard & Poor’s noted the school’s progress in its current $3 billion capital campaign, raising more than $1.6 billion as of late January.
“The stable outlook reflects our expectation that demand for the university’s programs will remain very strong, that management and leadership overall will remain stable, and that financial performance and resources will remain favorable,” Standard & Poor’s analyst Mary Peloquin-Dodd said in their report.