San Diego Business Journal

Airport Revenue Bonds Get Low Interest Rate: 3.92

Friday, February 1, 2013

The nearly $380 million in revenue bonds issued by the San Diego County Regional Airport Authority earlier this month for Lindbergh Field’s Green Build project got an extremely low interest rate that will produce considerable future savings, the agency said.

In a report, Vernon Evans, the authority’s chief financial officer, said the 3.92 percent interest rate that the bonds garnered was the lowest rate among all other national airports in the same class.

It will also save the agency some $71 million in reduced debt service over the 30-year life of the bonds, Evans said.

The favorable rate was the product of low interest rate environment, issuing bonds when there wasn’t a great deal of debt being sold, and the agency’s strong credit rating from all three of the credit rating agencies.

Most of the issued bonds, some $321 million, went to institutional investors, while $58 million was purchased by individual retail investors, the airport authority said.

The Green Build, which began in 2009 and includes adding 10 gates to Terminal 2 and other improvements, is about 75 percent complete and expected to be finished in August.

—Mike Allen