Bloomberg Information
Chicago is returning to market with a $375 million deal for O’Hare Worldwide Airport, based on score company experiences, and plans a $9.1 billion ramp-up in bond issuance that features vital new cash debt to fund the airport’s capital program.
The proceeds of the Sequence 2025A and 2025B senior lien basic airport income bonds will restore borrowing capability on a line of credit score used to fund airport capital tasks, the experiences mentioned.
The GARBs are secured by a primary lien pledge of internet revenues derived from O’Hare operations, and sure funds and accounts maintained underneath the senior lien indenture.
Fitch Scores affirmed its A-plus score on O’Hare’s GARBs Sept. 11, citing Chicago’s strategic location as a hub and O’Hare’s
KBRA charges the bonds A-plus with a secure outlook. In a Sept. 12 score report, the score company additionally affirmed the A-plus score and secure outlook on O’Hare’s excellent basic airport senior lien income bonds.
S&P World Scores charges the bonds A-plus with a secure outlook. It affirmed its A-plus long-term score and underlying score on Chicago’s GARBs in a Sept. 11 score report.
“The secure outlook on the GARB score displays our expectation that ORD enplanements will additional recuperate and the airport will return to totally residual operations, supporting monetary metrics which can be per the score as the town points further debt to fund parts of the capital program,” S&P mentioned in its score report.
The airport had $10.8 billion of whole debt excellent at fiscal year-end 2024. In keeping with KBRA, whole pro-forma debt will hit a peak of $19.8 billion by calendar yr 2031.
The Chicago Division of Aviation is within the midst of a $13.4 billion capital enchancment program at O’Hare which incorporates the $11.9 billion ORDNext terminal space program and $1.5 billion of further CIP tasks.
Chicago plans to concern extra GARBs later this yr to refinance excellent debt and fund components of the airport’s capital enchancment program.
“KBRA’s evaluation considers this deliberate borrowing, which incorporates $9.1 billion of further, new cash debt,” the score company mentioned. “With simply 25.7% of the Airport’s CIP funded at FYE 2024, the Airport’s debt burden is anticipated to extend considerably via FY 2031.”
Fitch famous that whereas O’Hare’s debt burden will rise considerably, “internet leverage will probably stay under 13x through the development interval and common 11x over 2025-2035, excluding the advantage of capitalized curiosity.” But it surely mentioned the preapprovals from airways for the capital program and the long-term residual airline settlement considerably offset these credit score pressures.
O’Hare “has demonstrated success on mission supply of advanced tasks whereas sustaining prices inside finances,” the score company mentioned.
Town’s finance workforce didn’t reply to a request for remark by press time.
