On May 13, 2020, New York City Transitional Finance Authority (“NYC TFA” or the “Authority”) sold its $850 million Future Tax Secured Subordinate Bonds, Fiscal 2020 Subseries C-1 with Loop Capital Markets as bookrunning senior manager. The Bonds were rated Aa1/AAA/AAA by Moody’s, S&P and Fitch, respectively. This was the first transaction for the City of New York (the “City”) post coronavirus and was the first transaction priced remotely in the history of the City of New York’s financings. Proceeds of the Bonds were used to finance general City capital expenditures. The Bonds were structured with serial bonds in years 2022-2041 and 2046 with a term bond in 2045 with a par call on November 1, 2030.
The Firm assisted the City in developing a comprehensive internet roadshow, primarily aimed at addressing concerns over the impact on revenues resulting from the Coronavirus pandemic. The roadshow was ultimately viewed by 60 research analysts and investors. Loop Capital Markets conducted a one-day retail order period that generated $552.69 million in orders, one of the most successful retail order periods for the Authority in recent history. After the retail order period, several maturities were closed and $562.2mm were offered for the Institutional Order Period.
The institutional order period generated $5.7 billion in priority orders across a wide range of account types. Institutional yields were reduced by 3-5 bps during pricing in the 5% coupon 2022-2035 maturities, 17 bps in the 4% coupon 2036-2040 maturities and 10 and 12 bps in the 5% coupon 2041 and the 4% coupon 2045 term bonds, respectively, with the final 3% coupon 2046 maturity remaining unchanged. The Authority received $6.2 billion in orders from a broad investor base, with the transaction being more than 7.37x oversubscribed. Due to market concerns, the transaction was initially sized only at $500mm, upsized to $700mm for the retail period, and finally to $850mm based on positive retail order results and significant institutional demand.