The San Diego County Regional Airport Authority (Airport Authority) completed a major bond financing totaling $1.94 billion.
Approximately $1.58 billion of the bonds will be used to pay for a portion of the New T1 program and achieved a true interest cost of 3.34 percent. This will reduce financing costs on a present value basis by an estimated $386.5 million over the life of the program when compared to the plan of finance approved by the Airport Authority Board of Directors in October.
Of the remaining portion of the bonds, approximately $357.2 million will be used to refinance existing debt that has been in place since 2013, resulting in net present value savings for the Airport Authority of approximately $52.7 million.
“The Airport Authority continues to be in a strong financial position and this bond sale reflects the market’s confidence in our ability to recover from the COVID-19 pandemic,” said Kimberly Becker, Airport Authority President & CEO. “These funds allow us to continue the momentum of the New T1, providing funds for construction and in turn benefiting the region through jobs and economic investment.”
Investor demand for the Airport Authority’s bonds was very strong – investors placed more than $7.7 billion worth of orders for the bonds which contributed to the Airport Authority achieving a record-low interest cost. The bond sale’s advantageous circumstances were due to several factors, including pricing during a time when interest rates were more attractive, and the Airport Authority’s strong financial profile as evidenced by favorable credit ratings for Airport Authority bonds from Fitch Ratings and Moody’s Investor Services.
ABOUT SAN DIEGO INTERNATIONAL AIRPORT (SAN)
Owned and operated by San Diego County Regional Airport Authority (Airport Authority), San Diego International Airport (SAN) is one of the busiest single-runway commercial service airports in the world and the third-busiest airport in California. SAN contributes nearly $12 billion in economic activity for the region by connecting the world to San Diego and San Diego to the world. In November 2021, the Airport Authority began construction on the New T1 which includes the replacement of the existing Terminal 1, improvements to the airfield, improved transportation connectivity to the airport, and a new administration building. The New T1 program’s total project budget is $3.4 billion and is estimated to create between 15,000 to 20,000 construction-related jobs. For more information about the New T1 please visit newt1.com. For more information about SAN please visit san.org.